Gold Price Has 50% of Upside by 2025 if Inflation Jumps Again, Market Veteran Says

• Market veteran Ed Yardeni predicts that the price of gold could soar to US$3,500 an ounce by the end of next year.

• If inflation soars to a second peak, that means gold will have nearly 50% of upside, says Yardeni.

• Other economists have warned that inflation will reach a second peak as price pressures in the economy linger.

Gold prices could soar through the end of 2025 if inflation makes a comeback, says market veteran Ed Yardeni.

Yardeni Research's aggregate forecast is that the gold price could rise to $3,500 by the end of next year, which means the precious metal's price will rise 49% from around $2,347 on Monday, as inflation threatens to repeat the mistakes of the 1970s, when the price of gold began to soar from $35 an ounce to a peak of $665 an ounce.

Gold prices are soaring to new highs," Yardeni said in a note to clients on Sunday, referring to March when gold prices hit record highs." Another documentary rise in wage prices due to higher oil prices would be reminiscent of the Great Inflation of the 1970s, when gold prices soared. In this case, $3,000-$3,500 per ounce would be a realistic target for gold by 2025."

Consumer prices have cooled sharply from their 2022 high of more than 9%, with inflation rising 3.2% in February, but market commentators warn of the potential for a comeback due to geopolitical conflicts and supply-chain disruptions caused by a strong U.S. labor market.

The recent rise in crude oil prices has also exacerbated inflationary pressures, with the price of Brent crude oil topping $90 per barrel last week as the E.U.P. resonance+ producers announced they would continue to cut production.

Adani predicted that oil prices could rise above $100 a barrel if the Middle East conflict escalates. He estimated that inflation could rise to a second peak in 20%, which would lead to a gold rally.

Adrian is not the only prognosticator who sees more upside for gold in the coming years. Top economist David Rosenberg says he sees 30% of upside in gold prices due to the risks posed by the Fed's expected rate cuts and heightened geopolitical conflicts.

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