If I asked you what’s next for an asset that has soared roughly 65% in just the last 18 months…hitting all-time highs nearly 70 times along the way…there’s a pretty good chance you’d say it’s long past due for a correction.

But as it turns out, when that asset is gold, you’d be hard-pressed to find any professional observers who think the metal is going to contend with a meaningful bout of weakness through the foreseeable future.

Pepperstone Strategist Michael Brown: “Gold Deserves a Place in Portfolios as a Hedge”

Michael Brown, senior research strategist at forex and CFD broker Pepperstone, points to last week’s events in the Middle East as a prime example of both the heightened uncertainty now characteristic of the global environment and the useful role that gold can play as a static hedge against its impacts.

“Overnight developments again highlight why gold deserves a place in portfolios as a hedge in today’s uncertain environment,” Brown said on Friday. “I still like bullion higher from here, particularly as reserve asset allocators continue to diversify their holdings.”

To be sure, a number of respected strategists were declaring their affection for gold’s prospects before the end of last week, and doing so despite the metal’s furious pace of growth since the beginning of last year.

Goldman Sachs Sees Central Banks & ETF Investors to Be the Principal Gold Consumers, Going Forward

Lina Thomas, commodities strategist at Goldman Sachs Research, is a prime example. Last month, Thomas made clear she sees little else but sunshine and blue skies ahead for gold, largely based on the widely held belief that central banks will continue to devour the metal at or near record demand levels.

“The long-run bull story for gold is that central banks are buying large amounts of it,” she said. “We expect that to continue for at least another three years.”

But Thomas thinks gold resilience will be buttressed, as well, by ETF investors’ rediscovery of the asset. The strategist believes near-term investor demand will be attributable to a growing expectation that we may see rate cuts, after all, as well as to the mounting recession concerns likely to catalyze them.

“While the key factor since 2022 used to be central bank buying alone, ETF investors are now joining the gold rally,” Thomas said. “As both compete for the same bullion, we are expecting gold prices to rise even further.”

As it happens, Goldman isn’t the only global banking powerhouse expecting a great deal from gold through the foreseeable future. In fact, the world’s largest investment bank, J.P. Morgan, took yet another opportunity last week to express its confidence in the yellow metal…doing so even before a fresh outbreak of Middle East hostilities sent gold another 1.5% higher on Friday.

“We Remain Deeply Convinced of a Continued Structural Bull Case for Gold,” Says J.P. Morgan’s Natasha Kaneva

It was in April that Morgan analysts first went on the record to proclaim that gold at $4,000 is a viable 12-month-or-so price projection. At the time, their outlook was rooted in the suggestion that tariff-intensified macroeconomic weakness is looming, which could encourage investors to join central banks in their relentless buying behavior.

“Underpinning our forecast for gold prices heading towards $4,000/oz next year is continued strong investor and central bank gold demand averaging around 710 tonnes a quarter on net this year,” the bank said in an analyst note two months ago.

Well, last week, Natasha Kaneva, head of global commodities strategy at Morgan, took the opportunity to revisit the upgraded price targets. In doing so, she affirmed the bank’s especially positive outlook:

“Earlier this year, we examined the structural shift in gold’s demand and geopolitically influenced pricing drivers fueling its rebasing higher, ultimately posing the question if $4,000/oz is in the cards.

“To answer the question — yes, we think it is, particularly now with recession probabilities and ongoing trade and tariff risks. We remain deeply convinced of a continued structural bull case for gold and raise our price targets accordingly.”

Kaneva’s doubling-down on gold comes on the heels of other recent gold-positive comments made by Grace Peters, Morgan’s global head of investment strategy. In May, Peters told Bloomberg TV’s Francine Lacqua that she sees gold’s drive to $4,000 fueled principally by continued vigorous demand among central banks as well as by heightened interest in the metal from investors seeking its safe-haven protection.

J.P. Morgan Investment Chief Peters: $4,000-Plus Gold in 12 Months Is “a New Reasonable Price Target”

“We came into this year with a price target for gold of $3,500,” Peters said. “We’ve just broken through that now. So again, looking 12 months forward, north of $4,000, we think, would be a new reasonable price target for gold, with key drivers being still emerging market central banks. When you look at EM (emerging market) positions versus DM (developed market) central banks, there’s quite a lot of room still for EM central banks to position closer to where their DM counterparts are.

“And also retail ETF buying,” Peters quickly added as the other key reason she believes gold is on track to reach $4,000 in the next year.

One feature of J.P. Morgan’s persistent enthusiasm for gold some may find compelling is that it seems to exist at multiple levels of the firm’s strategic asset planning: through Peters, in her capacity as a chief of Morgan’s overall strategy; through commodities head Natasha Kaneva; and and also through Gregory Shearer, head of base and precious metals strategy, whose near-term gold optimism appears positively ebullient:

“We think gold remains one of the most optimal hedges for the unique combination of stagflation, recession, debasement and U.S. policy risks facing markets in 2025 and 2026.”

Collectively, it’s a bold expression of faith in the 5,000-year-old asset’s anticipated fortunes from what might be the world’s most renowned investment bank; and one that might resonate deeply with investors tasked with considering how best to navigate what may, in fact, now be a permanently fraught economic and geopolitical environment.

This post is created and published for general information purposes only. The Gold Strategist blog and Bob Yetman disclaim responsibility for any liability or loss incurred as a consequence of the use or application, either directly or indirectly, of any information presented herein. Nothing contained in this post – or any other post featured at this blog – should be construed as a solicitation or recommendation to engage in any financial transaction. You should seek the advice of a qualified professional before making any changes to your personal financial profile.