Bank of America Predicts Gold Price Will Reach $3,000 Per Ounce

Commodities analysts at Bank of America are predicting that the price of gold could reach $3,000 per ounce within the next 12 to 18 months.

This optimistic forecast is based on the ongoing purchase of gold bullion by central banks globally and the potential for interest rate cuts by the U.S. Federal Reserve. Such cuts could lead to increased investments in physically backed gold exchange-traded funds (ETFs).

In a recent note to clients, Bank of America highlighted that the continued purchasing by central banks is crucial. They noted that a shift to decrease the proportion of U.S. dollars in foreign exchange reserves may result in increased gold acquisitions by these institutions.

The analysts emphasize that gold is still viewed as a reliable long-term store of value, a protective measure against inflation, and a useful portfolio diversifier. These qualities position gold as a strong investment choice in today’s context of rising inflation and geopolitical uncertainty.

Additionally, Bank of America referenced a recent survey by the World Gold Council, indicating that central banks intend to increase their gold purchases in the coming months. They anticipate that gold buying may accelerate in the latter half of the year, particularly with expected interest rate cuts and increasing volatility in U.S. Treasury markets.

So far this year, gold prices have risen approximately 15%, with the current market price at around $2,338 per ounce.