Macquarie Group analysts, led by Marcus Garvey, predict that gold could climb to an unprecedented $3,500 per ounce in the third quarter, with an average price of about $3,150. Trading near $2,940 at present, gold has risen roughly 12% year-to-date amid geopolitical tensions and concerns tied to U.S. tariff policies. The analysts say that investors and institutions are increasingly valuing gold for what it lacks: credit and counterparty risk.
They expect additional support for the metal from a deteriorating U.S. budget outlook, which could raise inflation expectations and boost demand for gold as an inflation hedge. Even at elevated prices, demand in the physical market—jewelry, bars, coins and industrial uses—remains healthy. The analysts also note there is significant room for bullion-backed exchange-traded funds (ETFs) to expand their holdings, which could further support prices.
This bullish case is not unique to Macquarie. Other major financial institutions have recently adjusted up their forecasts: Goldman Sachs increased its year-end target to $3,100, while Citigroup projects gold could reach about $3,000 within the next three months. Together, these forecasts reflect a broader industry view that a mix of geopolitical uncertainty, fiscal pressures and inflationary concerns could sustain elevated gold prices into the coming quarters.
Market participants are watching several factors that could shape the outlook: central bank policies, currency moves—particularly the U.S. dollar—real yields, and continued geopolitical developments. If inflation expectations rise and real yields stay low or fall, gold’s appeal as a non‑yielding asset that preserves value could grow. Conversely, a rapid normalization of real yields or a surge in the dollar could temper the upward momentum.
For now, the combination of strong physical demand, potential ETF inflows and macroeconomic risks underpins the more aggressive price targets from large institutions. Investors considering exposure to gold should weigh these macro drivers alongside portfolio objectives and risks, recognizing both gold’s historical role as a hedge and the potential for volatility in the near term.