Gold rally set to extend as Fed easing, geopolitical risks fuel demand - ANZ

Published 16/10/2025, 02:44
© Reuters.

Investing.com-- Gold’s rally is likely to continue amid mounting geopolitical and economic uncertainty and the U.S. Federal Reserve’s policy easing, analysts at ANZ said in a research note.

Gold prices have surged above $4,200 per ounce in the previous session, marking an annual gain of more than 60% so far.

"While comparisons are being made to the 1980’s price peak, the current price rise is underpinned by structural drivers, indicating that elevated prices will likely sustain," analysts wrote.

ANZ expects prices to reach $4,400 by the end of 2025 and peak near $4,600 by June 2026 before easing in the second half of that year.

“We expect the Fed to make four additional 25bp rate cuts through March 2026, with the terminal rate stabilising at 3.25%,” ANZ analysts said, adding that "directional downtrend in rates and consequential USD weakness will be beneficial for nonyielding gold."

Mounting political and trade tensions, concerns over the Fed’s independence, and ballooning U.S. debt levels are expected to keep investment demand for gold elevated, ANZ said.

Strategic investment flows have reached 682 tonnes so far this year, while central banks continue diversifying reserves amid geopolitical strains and de-dollarisation, the bank added.

ANZ said silver is likely to follow gold’s rally, forecasting prices to peak at $57.5 an ounce by June 2026.

"The factors driving gold are also supporting silver’s momentum. Investors who missed the rally in gold prices are now turning their attention to the white metal for exposure," analysts added.

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