(Kitco News) - Gold and silver's significant run through the first half of 2025 has taken many analysts by surprise, and they are now playing catch-up, according to the latest report from the London Bullion Market Association (LBMA).
While analysts were bullish on gold and silver at the start of the year, no one expected prices to break through $3,000 an ounce. In its annual precious metals forecast survey, 29 analysts associated with the LBMA projected an average gold price of $2,735.33 an ounce.
However, in the first half of the year, the LBMA London Gold Price recorded an average of $3,070.86 an ounce, with most of the gains occurring in the second quarter as investors bought gold as a hedge against growing geopolitical uncertainty, intensified by President Donald Trump’s trade war and import tariffs.
Spot gold last traded at $3,345.40 an ounce, up 0.10% on the day.
With the second half of the year now underway, 13 analysts have updated their LBMA price forecasts. They now see gold prices averaging around US$3,159 for the year, a 15.49% increase from the initial forecast.
At the same time, none of the analysts suggested that gold prices would fall below $3,000 an ounce this year.
“The majority of responding analysts suggested that while geopolitics is a key driver of the gold market, the markets are likely to pay more attention, in the near term, to U.S. monetary policy in general—and the U.S. budget deficit and dollar weakness, in particular,” the LBMA report said.
Looking ahead, the LBMA noted that the average updated year-end target is $3,324.40 an ounce, 27.3% above the end-2024 price. Gold ended 2024 with a 24% gain.
“Opinions were, however, divided as to the gold price high of the year, with US$4,000 being the highest and just under US$3,500 being the lowest (the current record LBMA London Gold Price is $3,454.70, achieved at the Tuesday, April 22 a.m. auction),” the LBMA said. “A significant number of analysts thought the price might actually fade by year-end, with five of the 13 predicting a December price of US$3,200 or lower.”
The LBMA did not provide any updated price forecasts for silver, which has outperformed gold in recent months. On Monday, the LBMA London Silver Price hit a record high of $38.995 an ounce.
At the start of the year, analysts forecasted an average annual silver price of $32.86 an ounce, up 16% from the 2024 average.
Nicky Shiels, Head of Research and Metals Strategy at MKS PAMP, was the most bullish on silver at the start of the year, forecasting an average price of $36.50 an ounce in 2025.
However, Debajit Saha, Head of Metals Research at Refinitiv, had the highest peak price prediction, projecting silver to reach a high of $43.50 an ounce this year.
The LBMA’s silver benchmark hit an all-time high this week, and prices are currently trading at their highest levels in 14 years. Silver’s all-time high remains $49.81 an ounce, set in April 2011.
