Vaneck CEO Jan Van Eck dives into the AI bubble discussion and explains the outlook for gold on “Barron’s Roundtable.”
Gold’s stratospheric rally, its highest percentage increase since 1979, surprised even the most bullish metal enthusiast as Wall Street companies chased the rally. The precious metal, which was trading at $2,606 last December, rose more than 66% in 2025, hitting a series of new highs and settling around the $4,325 level at the end of the year.
Looking ahead, companies such as Bank of America expect the yellow metal to reach $5,000 an ounce due to continued central bank purchases, rising U.S. fiscal deficits and a weakening U.S. dollar, ending its worst year since 2017 when the Wall Street Journal Dollar Index fell more than 6%.
“I think there’s still a lack of investment at this point,” Bank of America strategist Michael Widner said at the Metals Roundtable in mid-December. We don’t usually see an exit in the gold market because of the current trend, but honestly, we don’t see that happening. I think all of the factors that I outlined earlier and were bullish are still very much in place,” said Michael Widener, a strategist at Bank of America.
Gold prices will reach record highs in 2025. (license/image)
Widener said that while the price target would be about 14% higher than current levels, “the Fed’s hawkish leanings are a risk.”
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In addition to gold, silver also rose more than 142% and copper rose more than 41%, marking the year with its biggest single-year net and percentage gains since 2009.
Macro Mavens president Stephanie Pomboy admits she’s surprised by the pace of rise in precious metals prices, but expects more to come this year.
“I think we’re surprised at the speed with which we’ve reached this number, but I think there’s a lot more to come. The rationale for why I want people to go long in hard assets rather than paper is only just starting to fall into place, It was primarily my prediction that we would see a resumption of QE (quantitative easing), and that’s what happened. I know they’re not calling it QE, non-QE, or QE-lite, and I think they’re dipping their toe in the water. “What happens as we turn the page to 2026 is that the balance sheet becomes the primary source of financial stimulus,” Pomboy told FOX Business’ Charles Payne. “Balance sheet expansion is purely currency devaluation and nothing could be better for precious metals,” she added.
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The Fed cut interest rates by a quarter of a point in December, marking the third consecutive cut in 2025. Officials also signaled a resumption of government bond purchases.
“As detailed in today’s statement from the New York Fed, reserve purchases amounted to $40 billion in the first month and may continue to increase for several months to ease expected near-term pressures in money markets. After that, we expect the size of reserve purchases to decrease, but the actual pace will depend on market conditions,” Powell said at a December press conference.
