Due to lingering geopolitical uncertainties and the escalating risks of U.S. President Trump's tariff policies, the appeal of gold as a safe-haven asset continues to grow.

Analysts at Macquarie Group predict that gold prices could surge to a record high of $3,500 per ounce by the third quarter of this year—one of the highest gold price forecasts among Wall Street's major investment banks.

Macquarie analysts, including marcus Garvey, noted in a report that concerns over the potential expansion of the U.S. deficit are expected to provide additional support for gold prices.

Macquarie anticipates that the deteriorating U.S. fiscal budget outlook will signal rising inflation, thereby strengthening gold's role as a hedge. By the third quarter of this year, the average gold price could reach $3,150 per ounce, with the potential to climb as high as $3,500 per ounce.

Driven by geopolitical uncertainties and the risks associated with President Trump's tariff policies, gold prices have already risen by 12% this year. As of Thursday, gold was trading around $2,140 per ounce. Macquarie's forecast suggests that gold could surge by more than 60% from current levels.

The analysts wrote: "We view gold's price strength to date, and our expectation for it to continue, as primarily being driven by investors' and official institutions' greater willingness to pay for its lack of credit or counterparty risk,"

They pointed out that gold ETFs still have ample room to increase their gold holdings. Additionally, despite high gold prices, physical gold demand—including jewelry, bars, and coins—remains resilient.

Last month, goldman sachs raised its year-end gold price target to $3,100 per ounce, while citigroup expects gold to reach $3,000 mark within three months.

This week, strategists at BNP Paribas also raised their average gold price forecast for 2025 by 8%, predicting that gold will break through $3,100 per ounce in the second quarter of 2025.