Gold vs Silver vs Equity: Returns since 1995 compared – How much Rs 50k annual investment would be worth todayhttps://t.co/4Kg9HtKbct
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Gold prices are expected to climb in 2025 as President Donald Trump’s policies increase demand for the precious metal as a safe-haven asset. Analysts forecast that gold could reach $2,950 per ounce this year. Inflation, concerns about the fiscal deficit, and geopolitical risks are all factors that could drive a bullish market for gold during Trump’s administration.
#MarketAlert | Gold eyes third consecutive weekly gain as markets await Trump inauguration, with spot gold easing 0.4% to $2,701.03 per ounce 💰📉#GoldPrices #Commodities #MarketTrends #TrumpInauguration pic.twitter.com/uwLfMmlsiK
— ET NOW (@ETNOWlive) January 18, 2025
His focus on tariffs may raise the cost of imports and lead to higher consumer prices, which could boost gold’s appeal as an inflation hedge. Goldman Sachs analysts suggest that inflationary pressure from tariffs could push investors to allocate more funds to gold. If inflation accelerates in 2025, gold prices could gain substantial upward momentum.
Trump’s proposed tax cuts and deregulation are designed to stimulate the economy. However, these measures could expand the federal deficit and potentially weaken the U.S. dollar. But will it? Some people want this because when the dollar depreciates, gold benefits as it becomes cheaper for investors using other currencies.
Lengthy article from @guardian on the workings of various parts of the #gold market. Always good to read the details and perspectives of different market participants. https://t.co/nCHBIMQbHY
— Krishan Gopaul (@KrishanGopaul) January 19, 2025
Experts at Morgan Stanley suggest the dollar’s performance could be a key driver of gold prices under this administration. They recall similar trends during Trump’s first term when tax policies initially sparked optimism but later raised concerns about fiscal sustainability. Trump’s assertive approach to foreign policy has historically heightened global uncertainty.
Gold’s bullish trajectory under Trump
As a result, gold’s role as a safe-haven asset may gain prominence. Investors seeking stability during unpredictable times often turn to gold, and the potential for diplomatic tensions could increase demand.
Analysts at J.P. Morgan forecast gold could average $2,950 per ounce in 2025, with geopolitical risks being a significant contributing factor. While Trump’s policies could create inflationary pressures, how these intersect with the Federal Reserve’s monetary stance remains to be seen. Fed Chair Jerome Powell has indicated a commitment to taming inflation through higher interest rates if needed, which could strengthen the dollar and weigh on gold prices.
Historically, Trump has been critical of Powell, accusing him of being overly hawkish on rates. Renewed clashes between the White House and the Fed could introduce market volatility, further influencing gold demand. If the Fed opts for a tighter policy stance, it may counteract gold’s bullish momentum.
Conversely, inflationary concerns could dominate if the Fed pivots or pauses rate hikes, providing additional tailwinds for gold. With inflation risks, a potentially weaker dollar, and geopolitical concerns on the horizon, the outlook for gold appears bullish under Trump’s policy agenda. However, traders should closely watch the interplay between inflation trends and Federal Reserve actions.
Powell’s influence on interest rates and the dollar will likely remain key factors in determining the direction of gold during Trump’s administration.