Gold isn’t just expensive any more, it’s rewriting what “expensive” means. In 2025 we’ve seen bullion rally more than 30 percent, comfortably sitting above $3,300 per ounce, and this isn’t a flash in the pan, it’s a structural shift reshaping both how investors allocate capital and how you shop for jewellery.
Let’s start with what the experts are saying. Goldman Sachs now sees gold at $3,100 / ounce by year‑end, up from their $2,890 forecast. J.P. Morgan is calling $3,675 / ounce by Q4 2025, with a path toward $4,000 by mid‑2026, while Citigroup expects it to trade in a $3,100–$3,500 band through Q3. The most bullish analysts are even talking about $5,112 / ounce. When forecasts like these become consensus, $3,000 isn’t the ceiling any more, it’s the floor.
So what’s driving this surge? For starters, central banks have been hoarding gold at record pace, adding 244 tonnes in Q1 2025 alone. After Russia’s reserves were frozen in 2022, every major bank got the memo, diversify away from the dollar, and five‑fold growth on the London OTC market followed. At the same time, fresh trade tensions have returned, with “Liberation Day” tariffs in April stoking enough uncertainty to send gold prices 13 percent higher in three months, and new 25 percent levies on Canada and Mexico plus 30 percent on Chinese imports have only kept that pressure on. Finally, a record $38 billion flowed into gold‑backed ETFs in the first half of 2025, the biggest institutional rush since 2020, and wherever the big money goes, retail usually follows.
If you’re an investor, it’s time to revisit your allocation. The old rule of thumb was 5–10 percent of your portfolio in gold, but with stocks and bonds now often moving in tandem with bullion, many models suggest 8–15 percent as a new sweet spot. You don’t want to chase the rally at its peak, so maintain your 5–10 percent strategic core, cost‑average your buys on dips toward $3,100 / ounce, look into low‑cost mining producers or royalty companies for leveraged upside, and if your gold position swells beyond target, trim and rebalance to lock in gains. After a 30 percent rally, profit‑taking risk is real, so don’t put all your eggs in the golden basket.
For jewellery lovers, the picture is tougher. In Q1 2025 China saw a 32 percent volume collapse, India was down 25 percent despite wedding‑season resilience, and here in Australia raw gold costs are up 40 percent, squeezing margins at every step of the supply chain. That means more hollow and lightweight designs to cut content, a shift toward 14 ct over 18 ct to save costs, and even silver or platinum statement pieces becoming more appealing. Savvy buyers are locking in costs early for big purchases, choosing lower karats for everyday wear, seeking out estate or vintage pieces that pre‑date the price surge, or embracing high‑quality moissanite for their centre stones.
Let’s be clear, buying jewellery as an “investment” rarely pays off. You’re paying retail mark‑ups, craftsmanship premiums and design fees that don’t translate to resale, so if you want pure gold exposure, buy bullion, and if you want beautiful adornment, buy beautiful adornment. The one exception is vintage pieces from top houses like Cartier or Tiffany, which can hold value better, but even then you’re paying a hefty brand premium.
Of course, nothing is guaranteed. If inflation cools faster than expected, bonds could regain their appeal, a strong US economy might bolster the dollar, or further demand destruction in India and China could cap upside, we could see a correction. On the flip side, continued geopolitical flare‑ups, more central‑bank buying, persistently negative real yields or a faster de‑dollarisation trend would keep bulls firmly in control.
The bottom line is that gold at $3,300 + isn’t a temporary spike, it’s the new normal in a world of persistent inflation, geopolitical uncertainty and currency jitters. Investors should treat gold as insurance, not a get‑rich‑quick scheme, sizing positions appropriately and rebalancing religiously. Jewellery buyers need to adapt too, favouring lighter pieces, alternative metals or budgeting significantly more for the same look they’d have scored at $2,000 gold. The golden age of cheap gold is over.
Thanks for reading!
Jared & Brie
