Why Gold Is Expected to Rise to Record Highs

Gold remains in a structural bull market despite recent volatility and a 20 percent decline from January peaks. This current stagnation functions as an elongated pause driven by uncertainty regarding Federal Reserve policy under new leadership and geopolitical tensions in the Middle East, specifically energy market disruptions in the Strait of Hormuz. While higher interest rates traditionally challenge non-yielding assets like gold, concerns over fiscal sustainability and currency debasement are weakening these conventional correlations. Central bank accumulation has emerged as a critical floor for prices, with annual purchases rising from 400–500 metric tons to approximately 1,100 tons since the Russia-Ukraine conflict. Tony Kim, Global Head of Metals Trading at Goldman Sachs, identifies $4,000 as a significant support level for institutional investors to scale into long positions, emphasizing that central bank demand continues to drive the long-term trajectory.