Gold rally: JPMorgan believes the price of gold could double

• After the biggest daily loss in over ten years, JPMorgan sees the price of gold rising to as much as $6,000 in the long term
• Investors are increasingly using gold as a hedge against equity risk rather than against inflation
• Interest rate cuts, central bank purchases and a weaker dollar could further boost demand

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On October 21, 2025, the price of gold experienced the sharpest setback in more than a decade: the precious metal lost around six percent in just one day. But while many investors reacted nervously in the short term, the US investment bank JPMorgan Chase is surprisingly optimistic about the future – and even believes that the price of gold could double in the next three years.

Why JPMorgan remains bullish despite setback

According to MarketWatch, JPMorgan analyst Nikolaos Panigirtzoglou sees the latest correction not as a trend reversal, but as a result of short-term profit-taking. What is more important is that institutional investors are increasingly using gold as a strategic addition to their portfolio – no longer primarily as protection against inflation, but as a hedge against equity risks.

An analysis by MarketWatch shows that the bank cannot explain the current exposure solely through the so-called “debasement trade” logic, i.e. protection against a weaker dollar. Rather, investors would have bought stocks and gold at the same time in 2025 and turned away from long-term bonds. Gold’s share of global non-bank assets is currently 2.6 percent. If this value increased to 4.6 percent, the price of gold would increase by 110 percent – and JPMorgan considers this scenario to be plausible.

tailwind through Interest rate cut and stagflation concerns

Other departments at the major bank also remain optimistic. According to a Reuters report, JPMorgan analysts forecast an average gold price of $5,055 per troy ounce in the fourth quarter of 2026. The price could even climb to $6,000 by 2028. Compared to the current price level of $3,987.84, this would correspond to an upside potential of just over 50 percent. (As of: November 6th, 2025)

The main driver of this development is the US Federal Reserve’s change in monetary policy. The Federal Reserve’s interest rate cut significantly improves the environment for interest-free investments such as gold, said Natasha Kaneva, head of commodity strategy at JPMorgan. Her colleague Gregory Shearer added that “a combination of stagflation fears, worries about Fed independence and an ongoing diversification process away from the US dollar” should support demand.

Central banks and ETFs are driving demand

Other investment houses are also fundamentally positive: Morgan Stanley, for example, expects gold to rise to around $4,400 per ounce by the end of 2026. In particular, the ongoing purchases by central banks and the strong inflows into gold ETFs are supporting prices. According to the institute, the share of gold in global central bank reserves exceeded the share of US government bonds for the first time since 1996 – a clear signal of growing confidence in the long-term value retention of the precious metal.

Nevertheless, analysts also see risks. High prices could dampen physical demand, for example in the jewelry sector. In addition, environmental regulations and approval procedures limit the expansion of new funding projects. According to Morgan Stanley, a new “super cycle” in gold mining is not to be expected, but structural demand is likely to remain.

Editorial team finanzen.net

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