Eric Sepanek
SBC Founder
Eric Sepanek is the founder of Scottsdale Bullion & Coin, established in 2011. With extensive experience in the precious metals industry, he is dedicated to educating Americans on the wealth preservation power of gold and silver.
Gold may be pushed to $3,500 by the end of the year due to a complex mix of geopolitical uncertainty, central bank buying, and stagflationary risks, according to StoneX’s Head of Market Analysis, Rhona O’Connell.
The U-Word
The yellow metal’s booming rally has been primarily fueled by uncertainty. O’Connell highlights an array of catalysts, from trade wars and military conflicts to fiscal instability and political fragmentation. Major banks widely agree that uncertainty is a crucial factor influencing the 2025 economic outlook.
This sense of unpredictability is manifesting in some key metrics:
- Lower Consumer Spending: Recently, consumers spent less for the first time in nearly two years, as sticky inflation and rising costs erode their buying power.
- Falling Consumer Confidence – Americans’ outlook for the future decreased for the fourth month in a row in March, suggesting confidence in the economy is waning.
- Rising Volatility Index – The VIX, which measures market volatility, reached its highest level since the pandemic.
Central Banks Set the Stage
Over the past three years, central bank gold demand has soared over 1,000 tons annually, shattering prior averages. For reference, the yearly mine supply is only 3,600 tons. While many analysts emphasize the volume of gold consumption, O’Connell argues that the “sentiment and messaging” behind the demand are even more impactful.
This sustained official buying reflects a global de-dollarization trend as countries seek to hedge against USD weaponization and weakness. She argues that as more governments boost their gold reserves and move away from the greenback, investors are likely to follow, creating a domino effect against the dollar.
Sticky Inflation & Stagflationary Risks
StoneX’s Head of Market Analysis thinks inflation is a “close second” when it comes to supporting gold’s climb. Economists widely agree that prolonged tariffs would fuel inflation. The only question is how quickly. The longer it takes to ripple through the economy, the greater the risk of stagflation. This corrosive mix of stubborn inflation, stagnant growth, and a soft job market is complicated by weakening economic metrics and bearish forecasts. The last time the US suffered through stagflation throughout the 1970s, gold shot up by 2,300%
The Risk of Threat Reduction
Gold’s powerful upwards momentum is directly linked to an increasing sense of risk among retail, institutional, and national investors. The only threat the yellow metal faces now is “a massive reduction in risk,” according to O’Connell. As economic, geopolitical, and political uncertainty persist, the gold rally is likely to continue benefiting from this systemic volatility
Gold to $3,500
If these factors remain in play, StoneX sees prices extending to $3,500 in 2025. This would represent more than a 33% leap from the beginning of the year. The financial services company joins several reputable institutions raising their gold price predictions as the yellow metal continues shattering records amid escalating uncertainty and confusion.