Gold’s stratospheric rise, the best percentage gain since 1979, surprised even the most bullish metal mavens as Wall Street firms chased the run-up. The precious metal, which sat at $2,606 last December, rallied over 66% in 2025, hitting a series of new highs, settling around the $4,325 level at year-end.
Looking ahead, firms, including Bank of America, see the yellow metal reaching $5,000 an ounce due to continued central bank buying, rising deficits tied to U.S. fiscal policy and a weaker U.S. dollar, wrapping its worst year since 2017 with the Wall Street Journal Dollar Index down over 6%.
“It’s still underinvested, I think at the at the moment. And gold markets don’t normally come to an end because their overbought, gold markets come to and because the underlying motives that actually started the bull market have subsided and that honestly we don’t see. I think everything that I outlined before and what made us bullish I think is still very much in place now,” said Bank of America strategist Michael Widner during a metals roundtable hosted in mid-December.
While the price target bakes in around a 14% advance from current levels, “a hawkish tilt by the Fed is a risk,” Widner wrote.
ELON MUSK SOUNDS ALARM ON SILVER’S WINNING STREAK
In addition to gold, silver saw its own record year with a gain of more than 142% while copper advanced over 41%, the largest one-year net and percentage gain since 2009.
MacroMavens president Stephanie Pomboy, even admittingly surprised by the pace of the rally in precious metals, sees more ahead this year.
“I guess I am surprised at the speed at which we got to these numbers although I think there is so much more to come because the rationale as to why I wanted people to go long hard assets over paper has barely started to fall into place and that rationale primarily was my forecast that we would see a resumption of QE (quantitative easing) and we did. I know they are not calling it QE, non-QE or QE light or whatever. They are dipping their toe in the water, and I think what’s going to happen as we turn the page to 2026 is that the balance sheet will become the main source of monetary stimulus,” Pomboy told FOX Business’ Charles Payne. “The balance sheet expansion is outright monetary debasement and there’s nothing better for precious metals than that” she added.
‘PAWN STARS’ HOST WEIGHS IN ON RECORD YEAR FOR GOLD, SILVER
The Federal Reserve cut interest rates a quarter point in December, the third consecutive cut in 2025. Officials also signaled the resumption of treasury buying.
“As detailed in a statement released today by the Federal Reserve Bank of New York, reserve management purchases will amount to $40 billion in the first month and may remain elevated for a few months to alleviate expected near-term pressures in money markets. Thereafter, we expect the size of reserve management purchases to decline, though the actual pace will depend on market conditions,” Chairman Powell reviewed in his December press conference.
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