Bank of America raised its six-year gold forecast and set a $4,000 target. The bank highlights Fed independence risks.
Bank of America raised its six-year average gold forecast 6% to $3,049 and kept short-term calls at $3,356 for 2025 and $3,659 for 2026. Lead analyst Jason Fairclough told clients threats to Federal Reserve independence will raise safe-haven demand, and raised silver to $38.
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BofA Gold Forecasts And Near Term Calls
Fairclough kept BofA’s short-term calls at $3,356 for 2025 and $3,659 for 2026, while lifting the six-year average forecast 6% to $3,049 and setting a short-to-medium target of $4,000.
He described the bank as bullish on gold and raised the silver average to $38, a 7.5% increase. Fairclough told clients that gold has recorded strong gains this year, 31% YTD, futures and spot markets were trading in the $3,400s.
He said the change reflects sustained flows into bullion and higher central bank physical holdings. BofA kept tactical allocation unchanged for clients.
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The Four Drivers Fairclough Cited
Fairclough enumerated four drivers for the call. First, he pointed to the U.S. structural deficit and persistent fiscal gaps, which he said increase long-term demand for non-yielding assets.
Second, he highlighted inflationary pressure from deglobalization and higher input costs that can sustain real price support for bullion.
Third, he identified perceived threats to Federal Reserve independence, citing President Trump’s removal attempt of Governor Lisa Cook as a catalyst for safe-haven flows into gold.
Fourth, he referenced elevated geopolitical tensions and global policy uncertainty as compounding elements. He told clients these forces overlap and can persist years ahead.
READ ALSO: Gold’s Record-Breaking Momentum: Can It Climb Further?
Immediate Catalysts And Market Context
Fairclough pointed to immediate catalysts, specifically political events touching Fed governance, including the dispute over Governor Lisa Cook’s removal. And stronger safe-haven flows into bullion.
He noted that recent spot and futures trades, trading in the $3,500s, signal heightened investor interest and provide a backdrop for his $4,000 short-to-medium target.
Fairclough says risks to Fed independence constitute a material driver likely to push gold toward the bank’s $4,000 target now.
Conclusion
BofA says threats to Federal Reserve independence, fiscal strain and supply shocks are a catalyst that will sustain safe haven flows and drive gold toward the bank’s $4,000 target level.
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