JPMorgan reinforced its bullish case for gold by forecasting prices to rise to $6,000 per ounce by the end of US President Donald Trump’s current term in 2029, an 80% increase on current levels.
This scenario, according to its analysts, could realistically occur with just a small allocation away from US assets under the current macroeconomic climate.
Even with 0.5% of foreign-held US assets reallocated to gold, that would result in 18% annual returns and eventually send prices to $6,000, the bank wrote in a note on Wednesday.
The calculated returns are based on an estimated inflow of $273.6 billion, or about 2,500 metric tons, into the precious metals over four years.
While that doesn’t seem like much, amounting to only 3% of total gold holdings, “the additional demand impulse on a quarterly basis is quite immense,” JPMorgan said in its note. Given the supply of gold is relatively stable, even a minuscule boost in demand can create a big price swing, it explained.
“While hypothetical, this scenario illustrates why we remain structurally bullish on gold and think prices have further to run,” the analysts wrote.
Gold has rallied by nearly 28% so far this year, setting multiple records along the way, including the $3,500-an-ounce milestone last month. Prices have now doubled from where they were three years ago, highlighting the growing appeal of the safe-haven metal.
Driving the rally were years of geopolitical turbulence and economic uncertainty, which were exacerbated by the election of Trump, who has since launched a unprecedented trade war that is eroding investors’ confidence in the dollar.
According to JPMorgan, the Trump administration of “burden sharing” by other countries that benefit from the dollar’s status as a reserve currency have also put foreign investors on notice, prompting its bullish case for gold.
The $6,000 scenario adds to the bank’s already-optimistic views on gold. Last month, it predicted that bullion would average $3,675 an ounce by the fourth quarter of this year, on its way to reaching $4,000 by the second quarter of 2026.
