- Gold prices are expected to continue rising this year according to forecasts from the U.S. 'Big 5 IBs'.
- Copper prices are projected to surge to 15,000 dollars per t due to AI infrastructure and power grid expansion demand.
- Major institutions have given up further forecasts for silver prices, which have shown extreme volatility.
- The article was summarized using an artificial intelligence-based language model.
- Due to the nature of the technology, key content in the text may be excluded or different from the facts.
Commodities Market Outlook
Wall Street bets collectively on rising gold prices
JP Morgan "5,055 dollars per troy ounce"
Central banks and individual hoarding continue
Copper rally that rose 41% last year continues
Could surge to 15,000 dollars per t
Demand↑ from data center and power grid expansion
51% in three months… silver rose the most
Market gives up predictions due to high volatility
Global investment banks (IBs) forecast that the commodities rally that heated the stock market last year will continue into the new year. With interest rate cuts by central banks led by the United States expected, buying seeking an inflation hedge is expected to flow into gold. Copper, which has emerged as a key raw material for artificial intelligence (AI) infrastructure, is also expected to generate high returns this year.
$5,000 Gold Era Predicted
According to the financial investment industry on the 1st, the U.S. 'Big 5 IBs' by market capitalization (JP Morgan, Bank of America, Wells Fargo, Morgan Stanley, Goldman Sachs), which presented this year's commodities market outlook, all expect gold prices to rise from the end of last year (4,319 dollars per troy ounce). The most conservative forecast was Wells Fargo's 4,700 dollars per troy ounce. Goldman Sachs forecast 4,900 dollars, and JP Morgan expected it to rise to 5,055 dollars per troy ounce in the fourth quarter. Gregory Shearer, a JP Morgan analyst, said, "Since 2023, central banks have been reducing the dollar share in assets and increasing gold purchases, and this trend is expected to reach 755t per troy ounce next year," and "gold prices are expected to reach 5,055 dollars per troy ounce at the end of 2026 and 5,400 dollars at the end of 2027."
The background to the gold price strength includes the Federal Reserve's interest rate cuts, a weaker dollar, and increased demand for gold from central banks. Analysts say these supply-demand conditions are combining to push up gold prices.
Some also predicted that gold prices could surge above 5,000 dollars per troy ounce as individual investors began hoarding gold in earnest. However, Struijven, a Goldman Sachs analyst, said, "The share of gold in U.S. retail investors' portfolios is only 0.17%," and "each time retail investors, attracted by last year's returns (63.8%), increase their gold allocation by 0.01 percentage points, gold prices would rise an additional 1.4% above current forecasts."
Silver that even Wall Street has given up predicting
Non-ferrous industrial metals, which performed as well as gold last year, are also receiving attention as attractive asset classes. In particular, copper, which rose 41.76% last year, is attracting expectations. Copper prices have historically moved with manufacturing and construction cycles, but since the second half of last year they are analyzed to have joined an 'AI rally' because they are used heavily in AI infrastructure such as power grids and cooling infrastructure.
Citigroup said on the 5th of last month, "With expectations that the Donald Trump administration will impose tariffs on copper imports from 2027, demand to build up U.S. copper inventories has surged," and predicted, "copper prices will rise to 13,000 dollars per t in the first half of this year, and depending on interest rate conditions, up to 15,000 dollars per t."
Silver, which has shown extreme volatility this year, is an asset that even big players on Wall Street have effectively given up predicting. Silver has more diverse industrial uses than gold but, due to its lower price and smaller market size, its price has shown extreme swings depending on speculative demand.
In particular, since October last year the price per troy ounce skyrocketed 51.3% in three months, repeatedly reaching price targets set a year ahead within days. JP Morgan, in its November report when silver was trading in the low 50 dollars per troy ounce, had forecast "silver prices will gradually rise to 58 dollars per troy ounce by Q4 2026," but in reality this price was exceeded on December 5.
Citigroup also said in October last year, "Silver will rise to 70 dollars within the next 12 months," but in reality this price was reached in two months. The two institutions have not issued subsequent forecasts for silver prices.
Reporter Jeon Beom-jin forward@hankyung.com
