Gold Price Could Hit $10,000 This Year, Analyst Says

Gold prices could surge to an astonishing $10,000 this year if the monetary and geopolitical landscapes align, according to a forecast from SBG Securities. Analyst Adrian Hammond suggests the precious metal is already in its "last leg" of a major rally, driven more by powerful macroeconomic forces than by traditional mining stock leverage.

Why Gold Bullion Now Outshines Mining Stocks

For investors, the calculus has changed. Hammond argues that it no longer pays to hold gold equities over the physical metal itself. The reason lies in diminishing returns: earnings for mining companies are already so high that rising gold prices offer less meaningful leverage from this point forward.

For example, a 10% rise in gold from $3,000 per ounce previously translated into roughly 30% earnings growth for miners. From current levels, that same 10% price increase now delivers only about 13% growth. This shift turns most major gold producers into linear proxies for bullion, stripping away their high-leverage appeal.

While higher-cost miners like Harmony Gold and Sibanye Stillwater retain more relative leverage, the entire sector faces growing risks. Hammond points to cost inflation, capital spending that outpaces inflation, increased M&A activity, and rising resource nationalism. These headwinds explain his neutral stance on gold stocks, even as he sees another 20% to 30% upside for bullion this year.

Fed Rate Cuts: The Primary Catalyst for Gold's Surge

The outlook for U.S. interest rate cuts remains the key driver for gold prices. While markets are currently pricing in two cuts this year, Hammond sees potential for a more aggressive Federal Reserve.

SBG Securities outlines two powerful scenarios:

• Base Case: Three rate cuts could push gold to $7,000 by the end of the year.

• Dovish Shift: A more accommodative Fed could send gold soaring to $10,000.

However, Hammond believes the "more prudent" outcome would be for the Fed to hold rates steady. He notes that a weaker dollar is already contributing to U.S. inflation, a trend that could be intensified by higher energy prices.

Inflation Risks and the Danger of an Overshoot

The potential for a dovish policy shift is not without its dangers. Hammond states he is "constructive on oil, which could send inflation even higher." Such a backdrop could ultimately work against gold if its price runs too far ahead of its fundamental value.

This creates a real risk of gold overshooting and then correcting sharply. An overly dovish market narrative could "come back to sting gold," particularly if Fed policy remains tighter than investors anticipate.

Even in that scenario, a sharp collapse is not expected. Hammond argues that structurally supportive inflation will limit any significant pullback over the longer term. The more immediate risk is a "near-term dislocation," where political pressure pushes for rate cuts while the Fed remains cautious.

Central Banks and Investors Drive Underlying Demand

Beneath the speculative forecasts, strong fundamental demand continues to provide a solid floor for gold prices. Central bank buying remains a powerful tailwind, with global reserves rising by 45 tonnes in November.

China, in particular, has been a key player. The People's Bank of China added gold to its reserves every month last year, with its official holdings climbing to a record 2,304 tonnes by the end of the third quarter of 2025. Gold now accounts for 8.5% of the country's total holdings.

Investment flows have also turned supportive. In 2025, Gold ETFs added approximately 16 million ounces. Simultaneously, speculative positioning on the COMEX has grown increasingly bullish, with net long exposure rising sharply toward the year's end. This combination of official sector buying and renewed investor interest reinforces the positive trend, even as short-term policy uncertainty remains.