Gold on its way to $5,000 – central banks, investors and closing ranks with crypto
Gold on its way to $5,000 – central banks, investors and closing ranks with crypto
Several international analyst firms assume that the price of gold could rise to as much as 5,000 US dollars per troy ounce by 2026. Despite the strongest price increase since the oil crisis of 1979, which is expected for the end of 2025, experts see further upside potential for the precious metal in the following year.
Historically, gold marked the threshold of 1,000 US dollars for the first time during the financial crisis in 2008. In the Corona pandemic, the $2,000 mark was exceeded, followed by the announcement of counter-tariffs by U.S. President Donald Trump, the jump above $3,000. In October, the price of gold finally reached a new record high of $4,381.
This development is mainly driven by massive purchases by central banks, continued high demand from private investors and new market participants – including players from the crypto sector such as the stablecoin company Tether.
Analysts from JP Morgan, Bank of America and the research house Metals Focus therefore consider a gold price of 5,000 US dollars to be realistic.
According to Reuters, Bank of America's commodities strategist Michael Widmer points to several structural factors: growing US budget deficits, efforts to reduce the current account deficit and policies that amount to a weaker dollar. This mixed situation favours both portfolio restructuring and speculative commitments.
Philip Newman, Managing Director of Metals Focus, sees additional support from geopolitical uncertainties. These include doubts about the independence of the US Federal Reserve, ongoing tariff conflicts and geopolitical tensions as a result of the Ukraine war and Russia's relations with NATO countries.
Central banks as a driving force
According to analysts, the reallocation of currency reserves – away from the US dollar and towards gold – remains a key price driver. This trend has now continued for the fifth year in a row, with central banks often stepping in during periods of falling prices and stabilising the market as investors reduce positions.
"The price level today is much higher than in previous cycles because there is constant demand from central banks," explains Gregory Shearer, head of precious metals strategy at JP Morgan.
He also emphasizes that the market is currently in a comparatively adjusted positioning. This opens up scope for new upward movements as soon as investors get back in stronger.
JP Morgan believes that combined quarterly demand of around 350 tonnes from central banks and investors will be needed to maintain current price levels. For 2026, the institute forecasts an average quarterly volume of around 585 tonnes.
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According to JP Morgan,gold's share of global assets under management has risen from around 1.5 percent before 2022 to 2.8 percent today. Even though this level is historically high, it does not yet represent an upper limit, according to the bank.
Morgan Stanley expects a gold price of around $4,500 by mid-2026, while JP Morgan expects average prices to exceed $4,600 as early as the second quarter of 2026 and sees prices above $5,000 by the end of the year. Metals Focus shares this assessment for the end of 2026.
Hedging against risks on the stock markets
The Bank for International Settlements (BIS) points out that the simultaneous rise in stock and gold prices is an extremely rare phenomenon that has hardly been observed for decades. This raises questions about possible overvaluations in both markets.
According to analysts, a significant part of the recent gold rally served as a hedge against potential sharp declines in the stock markets. Intensified trade conflicts, geopolitical tensions and the war in Ukraine have further intensified this trend.
At the same time, gold is not free of risks: In phases of severe stock market corrections, even safe investments are often sold to create liquidity.
For 2026, many experts therefore expect a more moderate increase. Macquarie analysts see signs of stabilization in the global economy, gradual global growth, cautious interest rate cuts by central banks and continued comparatively high real interest rates – factors that could dampen the pace of gold price rise.
When crypto meets gold
A new factor in the gold market is the entry of institutional players from the crypto sector. Particularly striking is stablecoin company Tether, which is benefiting from a looser monetary policy by the Federal Reserve.
The latest quarterly reports show that Tether acquired around 26 tons of gold in the third quarter alone – a volume that is about five times the officially reported purchases by the Chinese central bank.
Further demand impulses could come from Asia. In India, certain pension funds were allowed to purchase gold and silver ETFs for the first time. China also opened up access to the gold market to selected insurance companies in February.
According to Metals Focus, however, these purchases have so far been limited, as the high price level is still causing many institutional investors to act cautiously.
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Tom Weyermann
My Assessment as – Should You Buy Gold Now?
My Assessment as – Should You Buy Gold Now?
Yes – but depending on your investment profile and strategy.
Gold as part of a diversification and hedging portfolio makes sense, not as a short speculative trade.
Gold as part of a diversification and hedging portfolio makes sense, not as a short speculative trade.
Why gold is
strategically interesting at the moment
strategically interesting at the moment
- Central banks are buying gold on a massive scale.
Several large institutions are diversifying away from the dollar and thus supporting demand.
→ foundation positive. - Macro risks still exist.
Uncertainties (tariffs, geopolitical tensions, sovereign debt) favor safe havens like gold.
→ hedging character strong. - Gold as a portfolio diversification.
Gold often correlates negatively or weakly positively with equities – it buffers risks.
→ risk management makes sense. - Crypto companies & new buyers in the market.
Crypto players like Tether are showing institutional interest.
→ new source of demand.
But:
- Gold does not yield any current income (no interest, no dividends).
- Liquidity/yield of stocks or real estate can be stronger over time.
When is a good time to get started?
This depends on why you want to invest:
🟡 1. You want gold as a long-term hedge
👉 Now partial purchases can make sense.
- Start with small positions.
- Build up gradually, e.g. staggered purchases over time ("cost-average").
→ advantage: smooths out price fluctuations.
🔵 2. You want gold as a tactical position (2–5 years)
👉 Entries in correction phases make more sense than in strong run-ups.
Gold often falls after rally peaks.
Gold often falls after rally peaks.
🔴 3. You want quick speculation
👉 Rather not actively get involved if you expect short-term profits.
Gold doesn't trade like Bitcoin: strong fast moves are rarely reliable.
Gold doesn't trade like Bitcoin: strong fast moves are rarely reliable.
How much gold in the portfolio?
Rule of thumb (non-binding):
- Hedging/diversification: 5-15% of the portfolio
- Defensive + focus on security: 10-20%
More than 20% can "over-hedge" a portfolio from a return point of view and potentially reduce return opportunities in other classes.
Risks to consider
- Interest rate development: Rising real interest rates often put pressure on gold.
- Strong stock markets: When stocks rise and interest rates are good, gold loses its relative appeal.
- Market psychology: Gold can fluctuate wildly, even without fundamental news.
Concrete strategy, pragmatic
✅ Yes, gold makes sense as a hedging and diversification building block
✅ Entry via graduated purchases, not 1x everything at once
✅ Focus on long-term perspective (3–7 years)
✅ Entry via graduated purchases, not 1x everything at once
✅ Focus on long-term perspective (3–7 years)
Short answer to your question
Should you buy?
➡️ Yes – but structured, not blind.
➡️ Yes – but structured, not blind.
And when?
➡️ About corrections and staggered, instead of investing everything at once.
➡️ About corrections and staggered, instead of investing everything at once.
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Inflation protection – how do you protect your capital from inflation?
The topic of inflation is not only of concern to large investors and investors with a high capital. The inflation affects each and every one of us. If you are already consciously investing in your financial future or are in the process of building up long-term assets, the topic of inflation protection is relevant for you. To address inflation protection, it is important to understand how inflation works. Find out all the information about inflation with us. We will also show you how to use precious metals correctly for individual inflation protection.
Definition Inflation
The pricing of goods and services is dynamic. This means that there are constant price changes. Products can become both more expensive and cheaper. If there is a general price increase for most products, there is talk of inflation. With a capital of 100 euros, you can then acquire less than in the past – the money is therefore worth less.
What types of inflation are there?
Depending on the course of inflation, the devaluation of money is called differently. In the industrialized countries, i.e. also in German-speaking countries, the so-called "creeping inflation" is particularly common. On a one-year basis, the rate of price increase is less than 5%. From an economic point of view, this price development is positive. Among other things, this low inflation value allows for cheap money bonds, which increases the willingness to consume. As a rule, inflation is always accompanied by a salary increase. This does not actively minimize the wealth of the citizens. In Germany, an inflation rate of 2% is considered normal.
As soon as inequality arises in this area, the entire economic system suffers from inflation. If prices rise rapidly faster than wages, existing assets are eliminated and the accumulation of new assets is almost impossible. Consumption collapses and the economy has to cover the shortfall with further price increases.
If this cycle enters a downward spiral within a very short time, this is called "hyperinflation". This process has the potential to bring the entire economy to a standstill.
What is deflation?
Deflation is the opposite of inflation. Here, the prices of consumer goods or raw materials are falling. For the economy, this means financial losses on several levels. On the one hand, it loses revenue due to the price reduction, and on the other hand, consumers tend to postpone large investments – in the hope of a lower price.
How is inflation measured?
Inflation is determined according to a fixed scheme. There is a price index that is determined for around 750 of the various goods. These goods are part of the fictitious basket of goods of the country's "average family". Which means that the basket of goods differs from country to country. As a rule, the price for this basket of goods is determined once a year in order to be able to determine the inflation rate.
Who is affected by inflation?
Since the basket of goods is an average value, not everyone is equally affected by the consequences of inflation. For example, a family with a child has a different buying behavior than a single person. Younger people buy different products than older people and there are differences between income brackets.
Key interest rate and inflation
The state is in a position to actively regulate inflation by adjusting the key interest rate. A low key interest rate means that banks borrow higher sums of money. The resulting increase in the money supply in the country favors the inflation rate. When the key interest rate rises, the bonds from the central bank fall and inflation is slowed down.
High inflation primarily burdens middle-class citizens. Income does not grow in proportion to inflation and regular expenses increase – which hits many unexpectedly and causes financial bottlenecks.
What causes inflation?
Normal and, above all, desired inflation is 100% driven by the economy. This can happen in several ways:
- Money supply inflation – there is more money in circulation, but the supply of goods remains the same.
- Demand inflation – the demand for goods increases with a constant supply of goods.
- Supply inflation – general increase in the price of goods.
Drastic hyperinflation is usually triggered by political or social circumstances. After the end of the war in 1945, Hungary experienced the highest inflation rate of all time. At its peak, the price increase was 14.9 quadrillion. The second highest overall inflation rate was recorded in Zimbabwe between 2006 and 2009. At the maximum, there was even an inflation rate of 500 billion in the short term. This resulted in the abolition of the country's own currency. Political unrest was the trigger for the economic collapse.
What is inflation protection?
Inflation protection refers to the fact that all forms of investment are safe from a loss of value due to inflation. Cash or capital in traditional accounts is not protected in any form. As soon as there is a loss in value, the capital is affected to the same extent.
In order to realize inflation protection, forms of investment are needed that are not affected at all or only to a small extent by the loss of monetary value. At this point, it should be said that there is no 100% inflation protection. But there are ways to hedge capital as much as possible.
How can I protect myself from inflation?
The topic of inflation protection must always be considered in the long term. This applies to investment capital of any amount. This means that it does not matter if the value of the capital falls in the meantime, as long as it ensures a increase in value in the long run, which also compensates for inflation.
There are generally two types of inflation protection for this. On the one hand, there are forms of investment that absorb the difference in value in the long term through rising price developments – precious metals of all kinds are well suited for this. On the other hand, there are forms of investment that ensure an increase in value through inflation itself and thus compensate for the loss of monetary value in tangible value – real estate as an investment is the right choice for this.
Art, jewellery and collectibles as inflation protection
Paintings or valuable collector coins are generally a safe investment that enjoys a certain inflation protection. However, such items are only suitable to a limited extent for circumventing the disadvantages of inflation in an emergency. If you lack the necessary knowledge, it is difficult to sell a painting quickly and at the right price, for example. The same applies to jewelry and many other luxury items. Small investments such as in collector coins, on the other hand, can be the right choice. This is because coin collections can be sold piece by piece and it is possible to find a buyer quickly in an emergency.
How good is gold as an inflation hedge?
Gold is known as an ideal inflation hedge. This is only partially true in the basic definition. This is because an investment for inflation protection should increase in value at times of high inflation in order to compensate for this. This is not the case with gold. The precious metal even tends to show absolutely independent pricing in times of inflation.
So does this mean gold is not a good inflation hedge? Not at all! The precious metal can convince with its first-class long-term development. Regardless of inflation in the country, gold remains at a high price level because it is an internationally traded commodity. Demand can be sold off on the global market. Gold is therefore an important cornerstone for inflation-proof investment portfolios.
Are equities suitable as an inflation hedge?
By definition, shares are a tangible asset. Since inflation affects the value of money, they are not fully affected by a loss in monetary value. Nevertheless, indirect losses in value can occur. The stock market reacts to the inflation event. A mixed portfolio of national and international equities is the basis for success here. In general, stocks should offer a return of at least 2% to offset the normal inflation rate.
What are inflation-protected bonds?
The stock market offers the option to buy inflation-protected bonds. Here, the repayment is directly linked to inflation. If the inflation rate rises, the interest rate is raised and vice versa lowered. However, such inflation-linked bonds offer lower yields and often have hidden costs such as processing fees – inexperienced investors should be careful here.
Is real estate suitable as an inflation hedge?
Owner-occupied real estate does not offer any special advantages within the framework of inflation protection. This is because the costs for the property are rising in line with inflation and must continue to be covered. The situation is different with real estate as an investment. Real estate prices are rising in the context of high inflation. If the properties are sold during the high price phase, you can achieve a good return and avoid inflation.
Money in savings accounts does not offer inflation protection!
During periods of low interest rates, it is not advantageous to store money in savings accounts. In the event of a high inflation rate, the loss of monetary value takes effect 1 to 1. An alternative is the use of call or fixed-term deposit accounts. Bank deposits are not subject to price fluctuations. In this way, short-term investments can quickly benefit from rising interest rates.
Conclusion – the right mix is important
There is no single investment option that offers absolute inflation protection. We advise you to use a comprehensive portfolio. A good mix of real estate – also in the form of equity units – classic bonds on the stock exchange and precious metals such as collectibles is the best way to be prepared for possible turbulence on the capital market. With an annual increase in value of 2% of the investment capital, inflation is absorbed in any case.
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Protection - Buy Gold/Silver Now - Deliveries within EU
Author: Tom Weyermann
Source: eurokerdos.cyprustimes
