Analysts at JPMorgan predict that gold prices will continue to rise, even though they are currently near record levels.
According to a Yahoo Finance article, this projection can be attributed to the growing expectation of rate reductions and the concerns about the independence of Federal Reserve.
Gold prices reached new heights on Wednesday.
New heights for gold
Gold futures, which represent agreements to purchase or sell gold for a fixed price at a later date, have reached a new record, exceeding $3,640 an ounce.
The price of spot gold (gold purchased immediately for physical delivery) also increased significantly, reaching a record high at $3,546 an ounce.
This impressive rally reflects strong investor demand, and is a reflection of a bullish market sentiment for precious metals.
Forecasts of prices
Analysts at JPMorgan predict that gold prices will continue to rise this year. Investors expect Federal Reserve rates to be cut beginning in September. This will make gold more attractive as it competes less with assets that offer yields.
In a Wednesday note, JPMorgan’s Patrick Jones stated that “US Federal Reserve rates cuts which are in line with or exceed expectations will catalyze further inflows into gold ETFs” and drive the gold price to its year-end target of $3675/oz.
Gold prices are expected to reach $4,250 in 2026.
The surge in demand is expected to be accelerated if Donald Trump succeeds at removing Federal Reserve governor Lisa Cook. This could have a significant impact on the direction of the central bank.
Jones, a writer
Gold prices could be affected by a potential weakening in the independence of the US Federal Reserve.
Demand for silver and its mining
Silver prices reached new highs of 14 years on Wednesday. They broke past $41 an ounce.
The jump in silver prices was a sign of strong demand from institutions, as it is also viewed as a safe haven.
Silver’s recent strength is highlighted by the fact that it last reached these levels in 2011.
Analysts at JPMorgan predicted that an increase of precious metal prices would positively affect the earnings for international mining companies.
AngloGold, a South African gold miner, and Fresnillo, a silver miner based in Mexico, have both seen their share prices increase by a significant amount this year, 160% and 2311%, respectively.
Mining stocks are up significantly year-to-date. Alamos Gold, based in Canada, has seen a 78% increase while Newmont Colorado has increased over 100%.
The year of Gold
Gold futures are up 39% this year. This is largely because of central bank purchases, and an increase in investment into exchange traded funds that have physical backing.
The precious metal outperformed both S&P 500 (which has seen gains of 9%) and Bitcoin (20%), who have shown similar performance over the same period.
UBS confirmed its forecast that gold will reach $3,700 an ounce in June 2026.
In a scenario of geopolitical and economic instability, the bank acknowledged that an increase to $4,000 is not ruled out.
Goldman Sachs also reiterated its prediction that the price of an ounce will be $4,000 by mid-2026.
The forecast can be attributed to the Federal Reserve’s eased policies and two factors in particular: a strong central bank demand, as well as an increase of ETF flows.
Analysts at Commerzbank AG predicted earlier this week that gold prices would reach $3.600 an ounce by year’s end.
German Bank had stated that gold would become more appealing if US president Donald Trump gained more control over US Fed. The US Fed is expected to become more dovish in the future, and this will be good for gold.
This article JPMorgan predicts gold rally and eyes $4,000 as Central Bank Policies Shift appeared first on The ICD
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