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Informist, Friday, Feb. 14, 2025

MUMBAI – Gold prices are seen rising to $3,000 per ounce in the near term and cross $3,080 per ounce by the end of March on safe haven demand due to rise in US trade tariffs and uncertain US trade policies, Ventura Securities said in a research report. Gold has outperformed equities and bitcoins so far in 2025, having risen 11% year-to-date, the brokerage firm said.

Talk about tariff on gold has also sparked a rush for the precious metal to be shipped to US before any new tariff levy in London, Switzerland, and Asia, the report said. 

Spot gold recently hit a recorded high of $2,943 per ounce, while COMEX gold hit an all-time peak of $2,968 per ounce. The recent strength stems from a mix of safe haven demand due to higher tariffs, geopolitical uncertainties, inflation concerns, central bank policies, and the continued strong demand from both central banks and retail investors, the report said.

Prices are also supported by demand from central banks for their reserves ahead of an expected surge in fiscal deficits, which could raise inflation. Demand from central banks also rose due to recessionary fear across the globe, the report said. Central banks bought 1,045 tonnes of gold in 2024, marking the third consecutive year of purchases surpassing 1,000 tonnes, the report said.

Gold will continue to be volatile, and as far as "uncertainty" prevails, its likely to remain bullish, the report said. The yellow metal has gained despite strength in bond yields and a strong dollar with US data indicating a solid economy, it said.

However, prices could be pressured due to the strength in treasury yields and a stronger dollar as the US Federal Reserve has been cautious and flagged no hurry to cut interest rates, the report said. High interest rates make the non-interest-bearing precious metal less appealing to investors.

Since importers in the US are facing higher inflation due to tariffs, the central bank has low impetus to cut interest rates.  End

Reported by Shreya Shetty

Edited by Ashish Shirke

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