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.
Following a relatively quiet December, gold has surged into 2025 with decisive momentum, marking one of the strongest Januarys on record. Gold’s recent climb to $2,900/oz pushed its gains past 75% since relative lows in October 2023. This strong growth reinforces the widely held notion that the climb isn’t over and increases the likelihood the yellow metal will hit the $3,000 target sooner rather than later.
Gold’s 2025 Surge: Same Storm, Higher Tides
The calendar may have flipped, but gold’s rally continues uninterrupted because, in many ways, nothing actually changed. The economic uncertainty and geopolitical instability underpinning gold’s upswing haven’t been resolved. Here are the primary drivers of gold’s current strength and the likely factors to push the yellow metal higher through 2025:
Central Bank Consumption
Central bank consumption remains the strongest spark fueling gold’s rise. In 2024, gold consumption among nations reached 1,045 tons, marking the third consecutive year demand exceeded 1,000 tons. This buying frenzy intensified in January as fears over Trump’s tariff plan drove investors to act quickly, hoping to avoid potential precious metals tariffs. Demand is so high that the Bank of England, the world’s second-largest gold custodian, is experiencing lines of eager customers to withdraw their gold.
China Resurgence
Boasting the world’s second-largest GDP and population, China plays a central role in global gold demand. Following a six-month drought, the People’s Bank of China (PBOC) resumed gold purchases in November 2024 at a strong pace. The other side of China’s influential gold demand is its jewelry market—the largest in the world. In fact, jewelry buyers eclipsed the country’s central bank in total gold demand. Many experts are already saying Chinese gold buying is likely to drive gold prices for the next decade.
Low Interest Rates
Interest rates are on the chopping block across the globe with fiscal leaders poised to make several slashes throughout 2025. Although the Federal Reserve has slowed rate cuts due to stubborn inflation, experts still anticipate a 50 bps reduction. The European Central Bank and the Bank of England are on a similar trajectory. This worldwide easing cycle decreases the appeal of holding yielding assets which often leads to heightened gold demand, reinforcing upward price movement.
Can gold clear a Trump recovery?
Gold enters 2025 with strong momentum, driven by persistent economic instability and uncertainty. However, a Trump-led economic recovery could present headwinds. A stronger U.S. dollar—historically a gold suppressant—has thrived under Trump’s protectionist policies, yet gold’s 2024 rally defied this trend, suggesting the relationship may be shifting. Likewise, a market rebound fueled by Trump’s pro-growth agenda could steer sentiment away from caution, but with both stocks and gold rising in tandem last year, the traditional inverse correlation may no longer hold.
$3,000 Gold is in Sight
Since the middle of 2024, experts have been calling for gold to hit $3,000. In January, the yellow metal’s confident upward bounce put it within inches of this milestone. The average gold price prediction for 2025 is over $3,000, suggesting this is nothing more than a psychological limit as many are expecting further gains.