Banks Also 'Stockpile' to Push Prices Up Amid Forecast of Gold Price Rising to $3,500

Gold Spot Prices Near $3,000
Gold Expected to Trade Between $3,000 and $3,200 Per Ounce

As tariff risks stemming from the Donald Trump administration escalate, international gold prices have surpassed $3,000 per ounce (approximately 4.36 million KRW) for the first time in history.

Reuters Yonhap News

According to the Nihon Keizai Shimbun (Nikkei), on the 13th (local time), the most actively traded April gold futures contract on the New York Commodity Exchange (COMEX) surged to an intraday high of $3,000.30 per ounce, up 1.8% from the previous session, setting a new record. As of 9:02 PM (Eastern Time), U.S. gold futures prices (Investing.com) were trading at $3,000.56 per ounce, up 0.31% from the previous trading day. Spot gold prices also rose 1.89% to $2,988.95 per ounce, marking the 12th record high this year.

The rise in gold prices is attributed to U.S. President Donald Trump's tariff policies. The trade war ignited by President Trump has increased economic uncertainty, driving funds into gold as a safe-haven asset. Typically, when investor sentiment shifts toward risk aversion, capital flows into gold. On the same day, President Trump announced retaliatory measures against the European Union (EU), imposing a 200% tariff on wine and other products. He took a tough stance, stating, "I will not back down one step on tariffs," and gold futures prices accelerated their upward trend immediately after this statement.

Strong gold purchasing demand from emerging market central banks is also fueling the price increase. Heightened caution over U.S. economic sanctions risks has led these banks to reduce their holdings of dollar assets such as U.S. Treasury bonds and instead accumulate large amounts of gold.

Nikkei analyzed, "Concerns over the trade war are exerting upward pressure on the dollar, while gold, which is also regarded as a safe asset alongside the dollar, is becoming increasingly attractive."

According to the World Gold Council (WGC), central banks worldwide increased their gold holdings by 1,045 tons in 2024, marking the third consecutive year that annual increases have exceeded 1,000 tons. Notably, gold reserves in China, Poland, and India have significantly expanded.

There are also forecasts that gold prices could reach $3,500. The commodities research team at Bank of America Securities (BofA Securities) projected, "If demand for gold increases by 10%, there is a strong possibility that gold prices could reach $3,500."

Additionally, growing expectations for the U.S. Federal Reserve (Fed) to resume interest rate cuts have pushed gold prices higher. Alex Evkarian, Chief Operating Officer (COO) of precious metals trading firm Alliance Gold, stated, "The bull market for gold is expected to continue for the long term," and forecasted that gold prices this year would trade between $3,000 and $3,200 per ounce.

On the other hand, there are views that it is uncertain whether gold prices will maintain their upward momentum. Nikkei pointed out that if President Trump shows strong determination to stabilize the Middle East situation and bring an end to Russia's war in Ukraine, thereby easing geopolitical risks, demand for gold could decrease.