F or two years, J.P. Morgan strategists have urged investors to buy gold, and for two years they have been right. On Tuesday, the bank predicted a triple crown, saying gold is once again the top commodity to buy.
“Gold still looks well situated to hedge the elevated levels of uncertainty around the macro landscape heading into the initial stages of the Trump administration in 2025,” wrote a team led by Natasha Kaneva, head of global commodities strategy.
Gold’s extended rally is reminiscent of the late 1970s, another period when inflation was a persistent problem. The price has risen 29% this year to a recent $2,667 per ounce.
It rose as high as $2,800, a record, in October, but has retreated since Donald Trump was elected president. The value of the dollar has risen since the election, and gold generally trades inversely to the dollar.
Kaneva thinks the postelection slump “was a positioning-driven stumble, not a sea change.” J.P. Morgan is projecting that gold will rise toward $3,000 per ounce in 2025, with an average price of $2,950.
There are two scenarios that could lift the precious metal. First, gold could end up being a beneficiary “if US policies indeed turn more disruptive (increased tariffs, surging trade tensions, stronger inflation, sizeable budget deficit expansion, and increased risks to economic growth),” the bank says. Gold could serve as a hedge against inflation, and central banks would have an incentive to buy.
It could also benefit if interest rates and the value of the dollar come down quickly, retreating from their postelection highs. Gold usually rises under that scenario, the bank says.
Gold isn’t the only precious metal that looks set up for a strong run in 2025. Silver and platinum also “have strong underlying deficit fundamentals,” and could rise later in the year, J.P. Morgan said. Silver could hit $38 per ounce from a recent $31, while platinum rises to $1,200 from a recent $960, the bank said.
J.P. Morgan isn’t the only bank that thinks gold is going to keep going up. Bank of America also expects it to hit $3,000 per ounce, and advises investors to buy it if it falls below $2,500. Strategists there think Trump’s policies could cause inflation to surge, making gold even more attractive.