After surging nearly 50% so far this year, gold could skyrocket 150% as soon as 2028 if its current pace continues.
The precious metal topped $4,000 an ounce for the first time earlier this week, then got another shock on Friday, when President Donald Trump announced he would impose 100% additional tariffs on China and limit U.S. software exports.
Stocks suffered their worst loss since the height of Trump’s trade war chaos in April. The dollar fell while gold jumped 1.5%, cementing its safe-haven status as investors lose confidence in the greenback.
In a note published Monday, market veteran Ed Yardeni, president of Yardeni Research, walked back his previous bullish calls on gold, which has repeatedly met forecasts ahead of schedule.
At that time, he cited gold’s traditional role as a hedge against inflation, the dedollarization of central banks after the freezing of Russian assets, the bursting of China’s housing bubble, as well as Trump’s trade war and his attempts to upend the global geopolitical order.
“We are now targeting $5,000 in 2026,” Yardeni added. “If it continues on its current path, it could reach $10,000 before the end of the decade.”
Based on gold’s trajectory since late 2023, the price could reach the $10,000 per ounce mark between mid-2028 and early 2029.
Gold has also benefited recently from the Federal Reserve’s shift toward rate cuts last month, as policymakers paid more attention to the stagnant job market and moved away from fighting inflation, which has remained stubbornly above their 2% target amid Trump’s tariffs.
Although the Fed has not announced an aggressive easing cycle, the prospect of further rate cuts while GDP growth remains strong has added to inflationary concerns.
At the same time, skyrocketing debt in major developed economies, including the United States, has made investors nervous about global currencies. That has fueled a so-called write-down trade that bets on precious metals and bitcoin on the assumption that governments will let inflation rise to ease debt burdens.
In a note published Wednesday, Hamad Hussain, climate and commodities economist at Capital Economics, said “FOMO” was creeping into gold trading, making it harder to objectively value the metal. He expects prices to continue rising, although the pace of gains will slow as key tailwinds weaken.
On the bullish side, Hussain highlighted Fed rate cuts, geopolitical uncertainty and fiscal sustainability concerns. On the other hand, he noted that gold’s recent rally occurred while the dollar was stable (through Friday) and inflation-protected bond yields were higher – telltale signs of market exuberance.
“As always, the lack of an income stream makes it notoriously difficult to objectively value gold,” he said. “Overall, we think gold prices are likely to increase in nominal terms over the next couple of years. »
