Elevated demand for gold should power the eye-popping rally behind the metal to a new key level, according to JPMorgan. Gregory Shearer, the bank’s head of base and precious metals research, thinks gold will surge past $4,000 by the second quarter of 2026 and reach an average price of $3,675 per ounce. “Tariff-driven recession and stagflation risks are forecasted to continue to supercharge gold’s structural bull run,” Shearer said in a Tuesday note to clients. “This price forecast builds on gains already made in 1Q25 and embeds continued strong investor and central bank gold demand averaging around 710 tonnes a quarter on net this year … positioning will continue to get stretched at times though we don’t think it is a structurally bearish risk in gold,” he added. Gold has been on a monster tear this year. Futures tied to the precious metal are up about 29% in 2025, significantly outpacing the S & P 500 as President Donald Trump’s tariff policies and policy decisions continue to rattle U.S. equities. On Tuesday, the metal hit a record above $3,500. @GC.1 YTD mountain Gold futures year to date The SPDR Gold Shares ETF (GLD) on Tuesday traded at an all-time high back to its inception in November 2004 and is up almost 30% in 2025. Underpinning Shearer’s bullish thesis are his expectation that the macroeconomic environment will continue to support sustained elevated levels of gold purchases by central banks, as well as greater investor holdings from ETFs and China. Central banks have significantly increased their holdings of the safe haven asset in recent years as a hedge against market volatility. Their purchases should amount to 900 tonnes in 2025 amid ongoing uncertainty with economic, trade and U.S. tariff policies, as well as greater unpredictability with geopolitical alliances, Shearer said. “There is still potential for multiple more years of elevated structural central bank allocation even as we also think higher prices in response to this demand impulse and the pull on inventory it is causing will continue to organically grow gold weights at central banks,” Shearer wrote. The strategist added that individual investors will likely keep purchasing gold amid threats of a recession and stagflation in 2025 and 2026 and an “atypical” risk-off moves higher in U.S. Treasury yields, which have raised questions around the possible foreign selling of Treasuries. Additionally, he said gold could see new entrants as demand from Chinese retail investors remains strong in the face of a potentially weaker Chinese Yuan. Get Your Ticket to Pro LIVE Join us at the New York Stock Exchange! Uncertain markets? Gain an edge with CNBC Pro LIVE , an exclusive, inaugural event at the historic New York Stock Exchange. In today’s dynamic financial landscape, access to expert insights is paramount. As a CNBC Pro subscriber, we invite you to join us for our first exclusive, in-person CNBC Pro LIVE event at the iconic NYSE on Thursday, June 12. Join interactive Pro clinics led by our Pros Carter Worth, Dan Niles, and Dan Ives, with a special edition of Pro Talks with Tom Lee. You’ll also get the opportunity to network with CNBC experts, talent and other Pro subscribers during an exciting cocktail hour on the legendary trading floor. Tickets are limited!
