Gold price to hit $2,750 by 2025, Bank of America predicts amid economic uncertainty
Gold price finds support at $2,600 level amid macroeconomic headwinds
Gold prices, after suffering their steepest daily decline early this week, have found temporary support at the 0.618 Fibonacci level, aligning with the $2,600 psychological threshold.
While the precious metal has shown modest recovery since Tuesday, analysts warn of looming headwinds from macroeconomic forces, including stronger U.S. growth, rising interest rates, and a robust dollar.
Bank of America analysts caution that U.S. President-elect Donald Trump's proposed economic policies, including potential tariffs on Chinese imports, could weigh on gold prices in 2025. While long-term fundamentals, such as growing public debt and portfolio diversification, support gold's appeal, higher growth, elevated interest rates, and a stronger dollar may suppress near-term demand. BofA maintains a 2025 forecast of $2,750 per ounce, a guarded optimism for the yellow metal’s resilience against fiscal and geopolitical uncertainties.
Technical indicators paint a mixed picture for gold outlook
The price action now hinges on a pivotal resistance at the 100-hour EMA near $2,650, a break of which could signal further upside but failure may see gold retesting its $2,600 support. On the hourly chart, gold’s RSI hovers near 60, signaling momentum for a potential sustained recovery. A decisive break above the 100 EMA could pave the way for further gains, mitigating the sharp losses experienced on Monday. However, if this resistance holds, gold's rebound may falter, potentially leading to a breakdown below $2,600, a critical level for bearish sentiment.
The broader metals market also faces volatility from trade tensions and global economic shifts. While base metals like aluminium and copper may find stability in tight supply dynamics, gold remains exposed to investors' sentiment. Should global fiscal policies prove unsustainable, as BofA suggests, gold could reclaim its safe-haven status in the longer term. For now, investors will be watching closely for signs of breakout or breakdown to determine whether the Gold price recovery can hold.
Gold price posts worst day decline as safe haven demand weakens. A bearish engulfing candle pattern emerged on the daily chart inciting bearish sentiment.
