An influx of investment has pushed gold demand to a record high. What happens next?

Demand for gold hit a record in the second quarter, when the precious metal reached a record $3.5 thousand per troy ounce and stayed close to that level, the World Gold Council (WGC) reported. According to the organization, strong inflows into gold-backed ETFs played a crucial role. Billionaire investors Ray Dalio and Thomas Kaplan advise to keep some assets in gold: the first - to protect against depreciation of conventional currencies, the second - in the expectation of growth above $10 thousand per ounce.

Согласно calculations WSG estimates that global gold demand, including OTC investments, rose 3% year-on-year in physical terms to 1,249 tons in April-June. In value terms, demand jumped 45% to a record $132 billion.Unofficial data indicates continued strong institutional investment and interest from high net worth private investors around the world, noted the organization in a quarterly report.  

"Strong demand for gold-backed exchange-traded funds (ETFs) was a key driver of overall demand growth for the second consecutive quarter. Global trade policy uncertainty, geopolitical turbulence and rising gold prices contributed to the inflows. Bullion and coin investors also got involved, attracted by the rising price and gold's status as a protective asset. Two [strong] consecutive quarters provided the strongest first half of the year for bullion and coin investment since 2013," reported the paper.

Billionaire investor Thomas Kaplan stated on precious metals trader Kitco's news service that the gold price spike in 2025 is just the beginning of a "long wave" of upside driven by central bank buying, de-globalization and changing perceptions of what forms of money are trustworthy. "We are seeing the perfect storm for gold," Kaplan said. Over the long term, the billionaire predicts gold to be worth more than $10,000 an ounce, while he projects silver to leap "into the open" above $50. For decades, he said, gold has behaved as "the world's most efficient currency" and "the most profitable exchange-traded commodity." To back that up, Kaplan noted that since 2007, when he switched from energy investments to gold, the precious metal's price has risen about fivefold, while oil has halved in price and the dollar has strengthened against the euro.

Investment guru Ray Dalio on podcast The Master Investor called for investors to allocate about 15% of their portfolios to gold or bitcoin as alternatives to traditional currencies, as the U.S. - and the world along with it - teeters on the brink of an "economic heart attack". In his words, as in the 1970s or 1930s, fiat currencies will depreciate simultaneously and lose value not relative to each other but to the hard currency, gold.

Gold prices are experiencing a summer lull, but a major breakout lies ahead that will reward patient investors, according to Florian Grummes, managing director of Midas Touch Consulting. In an interview with Kitco News, Grummes stated that there is now a so-called "crack-up boom" - accelerated inflation that is eroding the purchasing power of fiat money, be it the euro or the dollar. "I think we could definitely see [gold] above $4k by the end of the year," predicted he. 

This article was AI-translated and verified by a human editor