Gold’s remarkable rally this year – up more than 50% – has forced even the most sceptical traders to reassess the metal’s role in global markets.
In a new report, JP Morgan argues that the rise is not a temporary spike, but part of a long-term structural shift. The bank has raised its long-term gold price forecast by almost 80% to $3,850 per ounce, suggesting that investors are seeking assets more resilient than government-backed currencies amid shifting monetary conditions.
The investment bank says a new monetary “paradigm” is taking hold, in which confidence in fiat currencies is weakening and gold’s appeal as a store of value and a hedge against systemic risk is strengthening.
Gold hit an all-time high of $4,381.21 per ounce on Monday, more than 60% higher than at the start of the year, before retreating.
It is currently trading around $4,113.48 per ounce, after a sharp pullback earlier this week.
The record inflows underline the continued appeal of gold as:
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A hedge against inflation
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A buffer against geopolitical risk
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A defensive asset amid uncertainty in equities and bonds
Despite the recent price dip, investor appetite for gold remains exceptionally strong, with analysts suggesting that the metal is likely to stay well-supported so long as interest rate expectations soften and macro risks remain elevated.
