This translates into an annual return of 40 per cent, suggests a recent note by the World Gold Council.
Kindly note the image have only been published for representational purposes. Photograph: Kind courtesy, Pixabay
Gold prices can rise up to 15 per cent in a bull-case scenario from the current levels, reaching $3,839 an ounce levels by December 2025-end, translating into an annual return of 40 per cent, suggests a recent note by the World Gold Council (WGC).
“Should economic and financial conditions deteriorate, exacerbating stagflationary pressures and geoeconomic tensions, safe haven demand could significantly increase pushing gold 10 per cent-15 per cent higher from here,” WGC said.
In their base case scenario, WGC expects gold to remain range-bound in the second half of calendar year 2025 (H2-CY25), closing roughly 0 per cent–5 per cent higher than current levels, equivalent to a 25 per cent–30 per cent annual return.
The second half of the year, it believes, will keep investors on edge on account of geoeconomic uncertainty.
Gold vs other assets
While US inflation data have shown signs of improvement, concerns remain that conditions could deteriorate quickly.
“Dollar-related pressures are likely to persist, and questions around the end of US exceptionalism may dominate investor discussions. Overall, these conditions position gold as a net beneficiary – but while the fundamentals remain strong, the gold price has already captured part of these dynamics. In turn, sustainable conflict resolution and continued rising stock prices could lure more risk-on flows and limit gold’s appeal,” WGC said.
In their bear-case scenario, WGC sees gold prices dip 12–17 per cent in H2-CY25 finishing 2025 with positive but low double-digit (or even single-digit) return.
“Gold market technical analysis and speculative positioning suggest that $3,000/oz would be a natural support level, prompting opportunistic investment buying. If gold were to break through these levels, disinvestment may accelerate,” the note said.
Gold demand
Gold prices, meanwhile, have risen 26 per cent in US dollar terms in the first half of 2025 — and reaching double digit returns across currencies.
A combination of a weaker US dollar, range-bound rates and a highly uncertain geoeconomic environment, analysts said, has resulted in strong investment demand for the yellow metal.
Demand came from increased trading activity across OTC markets, exchanges, central bank buying and ETFs, WGC said.
This, in turn, lifted average gold trading volumes to $329 billion per day during the first half of 2025 (H1CY25) – the highest semi-annual figure on WGC’s record.
Gold price 2025
Gold ETF demand was particularly strong in the first half of the year, led by notable inflows from all regions.
By the end of H1-CY25 the combination of a surging gold price and investor flight to safety pushed global gold ETF’s total AUM 41 per cent higher to $383 billion, WGC said.
Total holdings rose 397 tonne (equivalent to $38 billion) to 3,616 tonne — the highest month-end level since August 2022, according to the WGC.
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Feature Presentation: Rajesh Alva/Rediff
