Gold Rally Slows but Momentum Remains Intact

Gold’s dramatic ascent from around $2,000 an ounce in early 2024 to above $3,400 by mid-2025 has slowed, raising questions about whether the metal’s run is over. After posting gains of more than 60% in just over a year, the market has entered a consolidation phase. Yet structural forces suggest the rally has not reached its conclusion.

Central banks continue to purchase gold at record levels, even as prices hover near all-time highs, with reserves now making gold the second-largest global asset after the US dollar. This trend affirms the role of gold as a hedge against inflation, geopolitical instability, and currency volatility. 

With global tensions rising and investors wary of financial repression, demand from both institutional and retail buyers remains strong. Projections point to gold breaking $3,500 per ounce by the end of 2025, with some forecasts extending gains further into 2026.

Recent economic dynamics have reinforced gold’s appeal as a portfolio diversifier. Traditional safe havens such as bonds have failed to shield investors during bouts of market turbulence, while gold has delivered uncorrelated performance. 

What Does This Mean for Me?

The current pause may reflect short-term profit taking, but underlying drivers, including a weaker dollar outlook, heightened central bank demand, and persistent geopolitical shocks, continue to support higher valuations. For investors, the message is clear: even if the parabolic surge has eased, gold’s role as a hedge and store of value in uncertain markets is stronger than ever.