Key Points
- Gold futures opened at $3,346.30 on Tuesday, up 0.4% from Monday’s close.
- Investors await key inflation data and updates on U.S.-China trade, both of which may influence gold prices. Gold has surged 46% year-over-year.
- Experts recommend allocating 5–20% of a portfolio to gold based on an individual’s risk tolerance.
- Goldman Sachs predicts gold could hit $3,700 per ounce by the end of 2025.
Gold futures opened at $3,346.30 per ounce on Tuesday, marking a 0.4% increase from Monday’s close of $3,332.10. This slight rebound follows a dip below $3,300 on Monday as investors await the May Consumer Price Index (CPI) report and closely monitor progress in U.S.-China trade talks.
The Bureau of Labor Statistics is set to release CPI data on Wednesday. According to market forecasts on Estimize, analysts expect a 0.2% rise in inflation for May, which would bring the annual rate to 2.5%, up from 2.3% in April. A higher-than-expected inflation reading could further boost gold prices, as the precious metal is often seen as a hedge against inflation.
Gold is also benefiting from the uncertainty surrounding U.S.-China trade negotiations, particularly over China’s export controls on rare-earth minerals, which are critical to the auto and robotics industries. Any disruptions in trade or negative economic data could drive more investors to seek safe-haven assets like gold.
From a market perspective, gold has gained 1.4% over the past month and is up a remarkable 46% year-over-year, rising from $2,290.60 per ounce on June 10, 2024. Despite a 1.1% decline over the past week, gold remains on a long-term upward trend.
As gold prices rise, investors are reevaluating their portfolio allocation strategies. Experts, including Scott Travers, author of The Coin Collector’s Survival Manual, advise that gold should comprise 5% to 15% of an investor’s net worth or as high as 20% for those with a higher risk tolerance.
Travers also cautions investors to include existing gold holdings, such as jewelry, when calculating gold allocation. He discourages selling jewelry to buy coins, as dealer fees can reduce the overall value.
Goldman Sachs has forecasted that gold may reach $3,700 per ounce by the end of 2025, driven by central bank demand and uncertainty related to tariffs.
