The year 2025 can easily be remembered for a gold rally. Gold bullion ETF SPDR Gold Trust GLD is up 51.7% so far this year (as of Oct. 8, 2025). Over the past month, the ETF has surged more than 11%. In comparison, the S&P 500 is up 15% this year and 3.7% in the past month.
In an environment marked with global instability, geopolitical tensions and the strong likelihood of Fed rate cuts, investors are flocking to gold as a reliable safe-haven asset. The current U.S. government shutdown has sparked demand for this safe-haven metal even more.
Dalio Recommends 15% Gold Allocation
Bridgewater Associates founder Ray Dalio advised investors to allocate up to 15% of their portfolios to gold, even as the precious metal surged past $4,000 an ounce, as quoted on CNBC. Dalio stressed on gold’s unique role as a hedge against monetary debasement and geopolitical uncertainty.
“Gold is a very excellent diversifier in the portfolio,” Dalio said Tuesday at the Greenwich Economic Forum in Connecticut. “If you look at it from a strategic asset allocation perspective, you would probably have something like 15% of your portfolio in gold… because it is one asset that does very well when the typical parts of the portfolio go down.”
Meanwhile, DoubleLine Capital CEO Jeffrey Gundlach has also advocated a high gold allocation — up to 25% of a portfolio — referring to inflationary pressures and a weaker dollar as reasons to favor the metal, as quoted on the same CNBC article.
Is History of 1970s Back?
Dalio compared today’s market environment to the early 1970s, a period of high inflation, heavy government spending, and growing debt, which hurt confidence in paper assets and fiat currencies.
While Fed rate cuts could cut the value of the greenback now, the strong supply of debt also makes debt instruments unappealing.
Central Banks’ Demand
A key driver has been surging central bank demand, especially from BRICS nations and emerging economies that are actively working to diversify away from the U.S. dollar. This global de-dollarization trend has resulted in record levels of sovereign gold purchases.
Central banks added a net 19t to global gold reserves in August, as quoted on the World Gold Council.China’s central bank pushed its buying streak to an 11th consecutive month in September. Per a report from Reuters, investment bank Goldman Sachs boosted its gold price forecast for December 2026 to US$4,900 per ounce from US$4,300 on Monday, due to inflows from Western exchange-traded funds and the likelihood of further central bank purchases, as quoted on the South China Morning Post.
Gold to Hit $10,000 by 2030?
Gold could reach $10,000 an ounce by 2030, per market expert Ed Yardeni, as quoted on Business Insider. That price target implies the precious metal rising about 151% in the next five years. President Trump's tariffs, his attempts to pressure the Fed to lower interest rates, and China's real estate woes are expected to push gold higher, per Yardeni.
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SPDR Gold Shares (GLD): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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