One of the biggest investment trends in 2025 is that buying physical gold has gone mainstream. No longer is owning gold viewed as an exotic alternative; gold has become the standout asset class among affluent investors and has become a mainstream portfolio component for diversification.

Wealthy investors more than doubled their allocation to gold from 5% to 11% this year, according to a new HSBC survey.

The HSBC Affluent Investors survey revealed that among wealthy investors, allocations to cash and cash equivalents fell by 13 points, while gold saw the biggest jump, increasing by 6 points. Real estate investment allocation increased 3 points, while equities lost 2 points and private equity gained 3 points.

It’s not just the affluent who are buying gold; high net worth individuals are also shifting more heavily into gold. There has been a noticeable uptick among high-net-worth U.S. clients who want to diversify from the depreciating U.S. dollar, which has dropped 10% this year, Stephen Jury, J.P. Morgan Private Bank’s global commodity strategist, said.

Investors aren’t just buying more gold; they are shifting how and where they store it.

Some high-net-worth American investors are shifting geography for where they store their physical gold, diversifying their gold holdings across multiple countries like Switzerland and Singapore.

Investors looking for the utmost in security are choosing military bunkers turned vaults. Swiss Gold Safe has built two of these vaults deep in the Swiss Alps, according to COO Ludwig Karl. “Most of our clients are from first-world countries,” Karl said. “However, our clients have lower trust in government or financial systems or are trying to build a backup or insurance plan by holding precious metals outside of the banking system in a neutral and safe country.”

In a fast-changing and increasingly complex world, physical gold offers investors a degree of control and privacy that is unparalleled in today’s highly regulated and tracked financial system.

Unlike stock, bond, or real estate investments that are tied to a specific location or fiat currency, gold is universally accepted and can be converted into local currency in every country on the globe. It carries a standardized and recognized value for a one-ounce coin, no matter whether you are in Tokyo, London, New York or Sao Paulo.

The record price of gold this year reveals the heightened uncertainty around what could lie ahead, but owning physical gold provides a proven ballast to portfolios and the safety and security that only an asset with a 5,000-year track record can provide. Have you considered if it is time to increase your allocation to gold—do you own enough?

Gold briefly slipped to a four-week low as some investors rotated back toward riskier assets, such as stocks, following the Israel-Iran ceasefire deal, which appears to be holding for now. Stocks climbed after President Trump said a trade deal had been signed with China, as Beijing agreed to approve rare earth exports.

Investors and traders had piled into the safety of precious metals as missiles flew in the Middle East and amid concerns that trade was slowing between the world’s two largest economies.  The ceasefire and trade deal alleviated some of the market’s most pressing geopolitical and economic concerns, prompting light profit-taking in gold.

Gold slid below $3,300 an ounce as short-term traders took profits on the recent double-digit rally in precious metals. The long-term trend remains positive for gold, and the metal remains well above its 200-day moving average, a technical signal that confirms the uptrend remains in place.

Gold and Silver Remain the Best Performing Asset Class in 2025

Even with the light pullback in gold prices, the precious metal is still notching a 21% gain since the start of the year, with silver up 20%, both handily beating the 4.41% gain in the S&P 500 this year.

Key Inflation Gauge Ticks Modestly Higher

The Federal Reserve’s preferred inflation indicator, the personal consumption expenditure (PCE), rose by 2.3% over the 12 months through May, the Commerce Department said. Excluding food and energy, core PCE inflation rose to 2.7% in May, from 2.6% in April. While the uptick in inflation is positive for the precious metals sector, gold and silver showed little reaction as the easing of the Middle East conflict, for now, has dampened fresh demand for precious metals.

Consumer Spending Drops for the First Time in 2025

Americans spent less in May on both goods and services as consumer spending fell 0.1%. Economists had expected consumer spending to gain 0.1% last month. Consumers bought fewer cars and spent less at restaurants and hotels.

Economists say that consumer worries about tariff hikes translated into weaker spending in the second quarter, which could have a broader impact throughout the year. Consumer spending is a major driver of the American economy, accounting for over two-thirds of all economic activity.

The Bottom Line

The price pullback in gold offers long-term investors an opportunity to accumulate precious metal at lower prices. Now is an opportune time to trade fewer of your dollars for more gold.  A number of major Wall Street firms target gains to the $4,000 area and beyond in the months and years ahead. Today’s pricing on gold offers long-term investors an opportunity to increase their allocation to the safety and security of precious metals while they are effectively on sale. Use the summer complacency as your opportunity to make savvy market moves.

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With a heat dome spreading across much of America this summer, it evokes images of kids running through sprinklers, days at the neighborhood pool, backyard barbecues, and fireflies at dusk. As we hit the halfway mark of 2025, it’s an opportune time to check in on the financial markets, key drivers for precious metals performance, and your portfolio.

The first six months of 2025 have been a whirlwind, marked by a fast-paced news cycle that began with the Inauguration of President Donald Trump for his second term in late January. So much has happened that we couldn’t possibly cover it all here, but we’ll touch on key developments impacting the precious metals and stock markets in the first half of the year.

Market Performance Since the Start of 2025

Gold +23%

Platinum +45%

Silver +21%

S&P +3.55%

International Stocks: MSCI ACWI ex-USA Index +16.28%

1-month Treasury Note Yield: 4.21%

5-year Treasury Note Yield: 3.84%

30-year Fixed Mortgage Rate: 6.82%

A few things jump right out.

• Precious metals are the best-performing asset class in 2025. Gold rocketed to a new record high above $3,400 an ounce in April and is trading quietly this summer above the $3,300 level.
• Foreign stocks are outperforming U.S. stocks by a significant amount.
• Mortgage rates remain higher than the low rates of the pandemic and the 2020-2021 era. In January 2021, 30-year mortgages hit a low at 2.65%. The high rates have priced many homebuyers out of the market for now.

The Big Picture

Liberation Day tariffs, geopolitical wars, a U.S. debt downgrade, and climbing national debt have been strong headwinds for the U.S. stock market this year and positive for precious metals. Investors flocked to the safety and security of gold, platinum, and silver amid the mounting uncertainties on many fronts, both military and economic.

Geopolitics Sends Investors Rushing to Precious Metals

Military action ramped up in June as the United States joined Israel with Operation Midnight Hammer, which involved U.S. Air Force B-2 stealth bombers dropping so-called “bunker buster” bombs on an Iranian nuclear site. Israel continues its war against Hamas in the Gaza Strip, and Russia continues its war in Ukraine.

While gold generally led the precious metals complex higher in the first half of the year, in June, both silver and platinum vaulted sharply higher. Precious metals investors saw opportunities to accumulate precious metals at bargain prices, and they swooped in. Silver climbed to a 13-year high, above the $37 an ounce level, while platinum climbed to $1,363.

Tariff Uncertainty

The stock market is eyeing a July 8 tariff deadline, which ends the 90-day pause on most of the steep Liberation Day tariffs if trade deals haven’t been set. Tariffs could climb as high as 50% against some nations.  While the Administration is said to be negotiating with China, the European Union, Canada, Mexico, and more, only one trade deal has been finalized thus far, and that is with the United Kingdom. Investors flooded into precious metals throughout the spring months as uncertainty over the impact of tariffs on the economy sent stocks spiraling lower.

America Lost Its Last “AAA” Credit Rating Due to Rising Debt

In May, Moody’s stripped the United States of its last “AAA” credit rating. This was another warning signal that Washington D.C. policymakers have failed to address the unsustainable government debt problem our nation faces.  Global investors fear that America is getting close to a point where our debt isn’t affordable anymore.

The news underscored the stability and security of gold in a world racked with government debt. For gold investors, this confirms that gold is in a long-term structural bull market. Analysts at JP Morgan issued a new research note in late spring outlining a scenario that could take gold 80% higher to $6,000 by 2029. They said this could occur if just 0.5% of U.S. assets held by foreign investors were reallocated to gold. Weak demand at Treasury auctions this spring already revealed tepid demand from foreign investors to buy new Treasuries.

Recommendations for Precious Metals Investors

In the dog days of summer, financial markets are relatively stable and quiet, for now. That makes it the perfect time to re-evaluate your portfolio, your asset allocations, and how much wealth protection you need for what may lie ahead. It’s a perfect time to trim your allocation to the stock market and funnel those funds to the safety of physical gold, silver, and platinum.

There is a step you can take to protect, preserve, and even grow your wealth, and that is to increase your allocation to physical gold.

If you aren’t sure what the appropriate amount is for your risk tolerance level, our Blanchard portfolio managers are here to help. Give us a call today at 1-800-880-4653 for a complimentary portfolio review with personalized recommendations to help you protect and grow your wealth. Precious metals are beating everything right now. We are in the midst of a historic gold run. Gold $4,000 will be here faster than you think, and once markets start moving again, you’ll have missed the chance to accumulate physical gold below $3,400 an ounce. It’s easy to add more wealth protection to your life. Why not call us today?

It’s no secret that global central banks have been stockpiling gold. But we just didn’t know how significant the central bank gold buying has been. Demand for gold bullion is so strong that the precious metal has surpassed the euro to become the second-largest asset held by central banks around the world.

For the last three years, global central banks have bought more than 1,000 tons of gold each year. Because of all that gold buying, today, gold is the world’s second-largest global central bank reserve asset, behind the U.S. dollar.

Gold pushed past the euro in 2024, taking second place, according to new data from the European Central Bank. Here’s the breakdown.

Global Central Bank Reserves

Source: European Central Bank, International Monetary Fund, Bloomberg

At the end of 2024, global central bank holdings of gold had climbed to around 36,000 tons, near the all-time high of 38,000 tons set in 1965.

Why are central banks buying gold? It’s simple. It turns out that central banks are buying gold for many of the same reasons that individual investors are piling into the precious metal.

Central banks are buying gold for diversification purposes and also to hedge against geopolitical risk, the European Central Bank report said. Reserve managers also value gold as a portfolio diversifier to hedge against inflation, cyclical downturns, and defaults.

Why does this matter to you? Central banks are long-term investors. They see value in gold at current levels and continue to buy and stockpile the precious metals in their global central bank vaults. If they are increasing their exposure to gold, maybe you should consider it too.

It’s been an epic rally in gold, and precious metals are still climbing.

The price of gold has climbed nearly 62% since the beginning of 2024. Silver is soaring too. Silver just jumped past $36.00 an ounce, and analysts are now pointing to $40 as the next big target. Platinum is also rocketing higher, climbing 35% since the start of the year. In fact, platinum, gold, and silver are the top three best-performing assets of 2025. Precious metals are in a strong uptrend, with huge momentum and are still climbing. A number of Wall Street forecasts point to gold at $4,000 an ounce and beyond.

For centuries, people have turned to precious metals as a store of value and as an asset to protect and grow their wealth. If you’ve been thinking about increasing your allocation to precious metals, don’t wait; the markets are moving, and gold at $4,000 will be here before you know it.

There are growing signs the U.S. economy has entered a slow patch in the first half of the year. From a negative growth reading in the first quarter to a sharp increase in Americans collecting unemployment checks, uncertainty about what lies ahead is showing up in the data. In the midst of it all, gold is the top-performing asset of the year with a 22% year-to-date gain.

The case for gold ownership remains strong, and in a late May report, Goldman Sachs urged investors to buy gold and oil to reduce portfolio risk. “Following the recent failure of U.S. bonds to protect against equity downside and the rapid rise in U.S. borrowing costs, investors seek protection for equity-bond portfolios. During any 12 months when real returns were negative for both stocks and bonds, either oil or gold have delivered positive real returns,” Goldman said.

Let’s dive into the economic picture.

Gross Domestic Product (GDP) Growth

In the first quarter of 2025, the U.S. economy went into reverse. After growing in 2024, economic growth turned negative in the first three months of 2025, shrinking by 0.2%, the Bureau of Economic Analysis said in its revision to the government data. Slowing consumer spending, a downturn in government spending, and an 11.3% decline in corporate profits were to blame. With profits slowing, there is probably little incentive for businesses to boost hiring.

Americans Collecting Unemployment Checks Hit 3 1/2 Year High

The number of Americans filing new applications for jobless benefits increased more than expected in late May. Initial claims for state unemployment benefits rose 14,000 to 240,000 for the week ended May 24, the Labor Department said. The number of Americans collecting unemployment checks in mid-May hit the largest number in 3 1/2 years.

This raises the risk that the overall unemployment rate could tick up to 4.3% in the May employment report, from 4.2% in April.

Spring Home Sales on Ice

Just as the spring home-selling season is supposed to be kicking into high gear, pending home sales dropped by 6.3% in April, the National Association of Realtors reported. Pending home sales fell in all four U.S. regions, NAR said.

“At this critical stage of the housing market, it is all about mortgage rates,” said NAR Chief Economist Lawrence Yun. Despite an increase in housing inventory, we are not seeing higher home sales. Lower mortgage rates are essential to bring home buyers back into the housing market.”

As of May 29, interest rates for a 30-year fixed-rate mortgage stood at 6.89%, the third weekly increase, according to Freddie Mac.

Next Stop: Gold at $4,000

Amid the signs of economic weakness, investors are turning to the safety of gold. For those investors wondering if it’s too late to buy gold given the big jump already this year, the short answer is no. Gold is in a strong bull market, and precious metals continue to climb. Goldman Sachs targets additional gains in gold prices to the $4,000 area by 2026, but the firm said that even a small move away from the U.S. bond market could drive gold far beyond the $4,000 level. Don’t wait to increase your allocation to gold; make your move today.

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