Gold's rally expected to continue, surpassing $3K: Experts

On Tuesday, gold reached a new record of $3,017 per ounce, up over 14% since the start of the year.

The increase in gold’s value has been fueled by central banks’ purchases – particularly by the People’s Bank of China and Chinese investors reacting to instability in the real estate sector – as well as ongoing geopolitical tensions between Russia and Ukraine, concerns over trade wars, and inflationary pressures.

Additionally, rising global debt, especially in the US, and a slowdown in inflation data supporting a potential rate cut by the Federal Reserve have also contributed to the surge in gold prices.

Chinese demand, gold flow from London to New York drive prices

Sant Manukyan, international capital markets manager at Türkiye-based IS Investment, explained that the rise in gold prices is being driven by a “geopolitical divergence” between China and the US, emphasizing that “this divergence will only intensify.”

“At the same time, this divergence creates uncertainties,” he noted. “Meanwhile, at a micro basis, the flow of gold from London to New York for fear of tariffs is among the reasons for this rise in the ounce price of gold.”

“I see gold’s trajectory towards $3,030 to $3,040 for now, but the ultimate target seems to be $3,200 per ounce,” he said.

Manukyan also said the Fed’s potential rate cuts and the resolution of Trump’s tariffs will be key factors influencing gold prices.

“It is important that we do not see a liquidity crisis in the market – there is no such thing for now,” he added. “China and Germany are introducing stimulus packages, but currently, there seems to be no development that will change gold’s (upwards) movement.”