Last updated: 5/16/2022
What will gold be worth in 5 years? Will gold hit $3,000 an ounce? What’s the current spot price of gold? That’s the question on many people’s mind as we watch the US inflation rate rise and political tensions spread across the world due to the Russia-Ukraine war. Gold has been the go-to defensive asset during times of high inflation and other uncertainties, so it’s no wonder that several experts are predicting that gold will soar in 2022 and could set a new all-time record.
Today’s gold price and recent price history of gold
The current gold price is $1,810.71 per ounce (troy), according to the last time this article was updated. (To see live gold prices, check the ticker at the top of each page on our site.) If we look back in the recent history of the gold price, we see two clear spikes where the precious metal soared to record highs.
To follow the development in the gold price and see its price history, you can check out our interactive gold price chart below:
Projection 1: Increased Gold Prices
In 2020, the price of gold soared to a new record high. No one would have predicted that just one year earlier, but sometimes events come out of nowhere and rattle the economy. In this case, it was the global pandemic that made the price of gold soar to new heights.
The reason gold often skyrockets when a so-called “black swan” event occurs is that people seek defensive assets. They see the value in diversifying their savings with gold.
A question that many people ask when inquiring about gold is: “What will the price of gold be in the next 5 years?” That question should not come as a surprise since gold holders will be curious about the potential growth in the price of gold.
What will gold be worth in 5 years?
Due to increased money printing and rising inflation, many industry experts believe gold could be worth over $3,000 an ounce in 5 years. Some precious metals experts are forecasting that gold could be worth over $3,000 per ounce in the next 5 to 10 years. According to Goldman Sachs, the price of gold per ounce could reach $2,500 in 2022 alone. but for it to increase beyond that we likely have to see a few of the factors that impact the gold price occur at the same time or escalate. That could increase the demand for gold and, thus, the price of gold.
Below are some key events that — if they take place — might make the price of gold hit $3,000 in 5 years’ time.
2023 – Inflation soars even more out of control
Inflation has been increasing steadily for the past year, and there is no end in sight as the key drivers behind inflation are all in place — supply chain issues, manufacturing issues, lots of money from the Fed that hasn’t hit the economy yet, rising food prices. In fact, inflation could get even more out of control, and the Fed’s small interest hike of .25 basis points dwarfs compared to 8.5% inflation.
With rising inflation, the demand for gold and the price of gold per troy ounce could easily soar. Especially if inflation rises and persists into 2023 or longer, the gold price could go up.
2024-2027 — A stock market crash, recessions, more war?
Rising US inflation is just one of the many concerns. Some say the stock market is in a bubble, and if that bubble bursts, the fallout could be devastating since stocks have never in history been this overvalued before, according to the Buffett Indicator. Meanwhile, the pandemic is still with us, and the economic recovery is slowing down.
Projection 2: Decreased Gold Prices
Some analysts are predicting a recession soon. On top of that, the war between Russia and Ukraine has no end in sight and it might even spread to other countries, which could force the US and the EU into action.
Such an escalation itself could make many people seek out gold as a defensive asset — and Goldman Sachs recommends buying gold — which would make the price of gold rise. If all these factors collide, the gold price rally might take off to never-before-seen heights, pushing gold to $2,500 or even $3,000 an ounce.
The first of the two gold price records happened in 2011 in the aftermath of the Great Recession. The long, deep recession made many people seek out gold as a defensive asset to help protect their purchasing power.
The second spike was in 2020, where the price of gold skyrocketed to over $2,000 an ounce. As the pandemic has gone through cycles, the gold price has been quite steady since its 2020 record. Currently gold still has room to grow before setting a new record.
What factors could make the price of gold reach $3,000 per ounce in the next 5 years?
Gold would need to rise less than 10% to set a new record and around 50% to make gold hit $3,000 an ounce. To understand what gold will be worth in 5 years, we’ll look at the following factors that influence the gold price. Will gold go up? Let’s see what’s ahead.
1. The US inflation rate keeps rising and could increase the price of gold
Since early 2021, inflation has been rising consistently. This year the US inflation is already over 8%, the highest in 40 years. In the past, high inflation has resulted in a rapidly rising gold price per ounce. During the 1970s and up to 1980, inflation was rising rapidly, and the gold price went up over 2,000%!
If inflation persists around 8% or if it keeps rising, we could see the price of gold soar. It’s unlikely that gold would rise 2,000% again, but gold would only need to go up 50% to reach $3,000 an ounce.
2. The US is hit by another recession which could push the gold price up
Several analysts are saying that the US could soon be in another recession. As we saw in the recession following the housing collapse in 2008, the price of gold per ounce could very well rise as demand for the defensive precious metal rises. But that’s not the only time a recession was followed by rising gold price.
As you can see in the chart, the price of gold per troy ounce often rises during or right after a recession. Note that the price of gold didn’t rise before 1970 because the government had locked in the gold price. So its price wasn’t determined by the markets.
3. The Russia–Ukraine war escalates and spreads to other countries
Historically during times of geopolitical tensions and wars, gold has performed well. Since Russia invaded Ukraine, we’ve seen some upside movement in gold. If the conflict persists, which we hope it does not, and especially if it escalates and draws in neighboring NATO countries, it is likely that the demand for defensive assets such as gold will rise quickly. That could make the gold price go up and perhaps reach $3,000 per ounce.
There are already experts out there that have updated their gold forecasts. For instance, Goldman Sachs has raised their near-term forecast for the price of gold to $2,500 before the end of 2022. Given that, what will gold be worth in 5 years?
4. The demand for gold increases and the gold price an ounce goes up
The demand for gold comes from several sources. Many people buy gold to try to protect their purchasing power during uncertain times. But the price of gold could also be affected from other sources. Central banks, for instance, have increased their gold reserves substantially over the past decade, and as fiat currencies weaken, central banks are likely to buy more gold, which could make the gold price per ounce go up.
Gold is also used in many industrial applications, and as the demand for those products goes up, so does the demand for gold and, likely, gold will rise too.
5. The stock market is hit by uncertainty
The price of gold is typically uncorrelated with the stock market, but historically the gold price has gone up when stock prices went down. If the stock market sees a correction or a crash, it will most likely make gold prices increase. The stock market rally of 2021 has fizzled out a bit so far in 2022, which could mean that stocks are at their peak and could correct
There are also indicators that the stock market is overvalued, such as the Buffett Indicator. If that is the case and stocks revert, the gold price could go up and perhaps the price of gold will hit $3,000, especially if other factors move in gold’s favor at the same time.
6. The global supply chain issues persist
Soon after the pandemic hit the world in 2020, many businesses and manufacturers closed down temporarily or permanently. That has led to problems in the global supply chain, including the supply chain for gold and other precious metals. The constrained supply of gold could continue, which could make the price of gold per ounce rise.
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