Gold Prices Surge Sharply in May 2025, Break Global Records Amid Economic Uncertainty

Global gold prices recorded a significant surge in May 2025, driven by increasing demand for the precious metal as a safe-haven asset amid growing economic uncertainty and escalating geopolitical tensions. In the international market, spot gold prices broke an all-time high, reaching US$3,500.05 per ounce, up more than 26% since the beginning of the year.

Key Drivers Behind the Gold Price Surge

According to a report by Reuters, several key factors contributed to the sharp rise in global gold prices:

Central Bank Activity
Central banks across various countries have increased their gold reserves as a means to diversify asset portfolios and protect against volatility in the global financial markets
 

Geopolitical Tensions
U.S. President Donald Trump's controversial policy imposing a 100% tariff on foreign films has sparked fears of a global trade war. This development has led global investors to seek asset protection through instruments such as gold.
 

Federal Reserve Monetary Policy
The U.S. Federal Reserve’s benchmark interest rate has remained stable in the range of 4.25%–4.50% since December 2024, supporting the rise in gold prices. The low bond yields have made gold a more attractive alternative investment.

Global Gold Price Projections

According to Goldman Sachs, gold prices are projected to reach US$3,700 per ounce by the end of 2025, and could potentially hit US$4,000 by mid-2026 if current trends persist. In a recession scenario, gold prices may soar as high as US$4,500.

Meanwhile, veteran investor John Paulson, as cited by Reuters, forecasts that gold prices could reach US$5,000 per ounce by 2028, fueled by ongoing central bank purchases and intensifying global trade tensions.

Gold Prices in the Domestic Market

In Indonesia, the price of gold produced by PT Aneka Tambang (Antam) also experienced a notable increase. As of May 5, 2025, the price of Antam’s 24-karat gold rose by Rp3,000 to Rp1,905,000 per gram.

The crypto and digital asset trading platform Indodax predicts that Antam’s gold price may reach Rp1,950,000 per gram by mid-May. If the bullish sentiment continues through the end of the month, the price could even surpass Rp1,970,000 per gram. However, if the market corrects or the U.S. dollar strengthens, gold prices could decline to around Rp1,880,000 per gram.

Positive Outlook for Gold

Overall, the outlook for gold prices in May 2025 remains positive. A combination of strong central bank demand, persistent geopolitical tensions, and accommodative monetary policies are the main catalysts for the price rally. Investors are advised to closely monitor global dynamics and consider gold as a vital component of a diversified investment portfolio.