Gold is reaching a new high! The central bank has increased its holdings for three consecutive months, with up to 200 billion yuan in insurance capital entering the market. Brokers have stepped up their efforts to “conduct research”

(Photo source: Visual China)

Blue Whale News, February 12 (Reporter Wang Wanying)Gold prices hit a new high again! International spot gold prices rose to a record high of US$2,942.7 per ounce during the Asian trading session on the 11th, pointing to the US$3000 per ounce mark. Since the beginning of 2025, gold has hit new highs eight times, and the cumulative price increase has exceeded 10%. It is one of the most outstanding assets in the global investment market. In the A-share market, gold concept stocks also rose one after another, complementing the popularity of offline gold stores.

The reporter noticed that securities firms are also stepping up their efforts to study this gold craze. According to incomplete statistics, more than 30 brokerage research institutes have released more than 60 gold-related research reports in the past week, which has greatly satisfied market attention.

After soaring all the way, what is the future trend of the gold price? Will it continue to accelerate or step on the brakes? This may be the core topic that markets and investors are most concerned about. UBS expects the upward trend in gold prices to continue and raised its gold price forecast for the next 12 months to US$3000 per ounce. Huatai Securities Research reported that it is optimistic about the upward trend of the gold boom cycle. Guangfa Securities Research News believes that gold’s safe-haven property may play a role in the breakthrough of gold prices and is optimistic about short-term upward elasticity; Guosheng Securities Research News reminds that gold prices may fluctuate upwards and should not chase higher in the short term.

Another concern is that insurance funds have been approved to launch a pilot investment in gold business, which is believed to have a positive impact on the gold market. Some brokerage analysts predict that based on the latest total asset data of 10 pilot insurance companies, the theoretical upper limit of configurable gold assets will be nearly 200 billion yuan. This move may help increase the activity and liquidity of the gold market and form certain support for gold prices.

Does gold continue to strengthen or peak? Brokers intensify research”

The only thing that can compete with DeepSeek in recent times is gold. Some investors even call this round of gold boom a gold bull market, and even the central bank is buying gold! rdquo;

According to official reserve asset data, as of the end of January 2025, my country’s central bank’s gold reserves were 73.45 million ounces, an increase of 160,000 ounces from the end of last month. The central bank has increased its holdings of gold for three consecutive months.

Next step, what is the trend of gold? The reporter noticed that as the market became hot, various brokerage research institutes were also working hard to conduct research and put forward their opinions one after another.

Judging from the current release of research reports, most securities firms remain bullish on the trend of gold in 2025 and predict that there will be still large upside for future gold price shocks. The main driving factors include the Federal Reserve’s monetary policy, geopolitical risks, central bank gold purchase demand, and macroeconomics. Environment, etc.

Huatai Securities Research News mentioned that in 2025, the main driving force for the short-term rise in gold prices may come from reflation-induced changes in U.S. tariff policies and uncertainty in the global economy; combined with market concerns about the valuation bubble of U.S. stocks, it may also prompt some funds. Turn to allocation of gold for safe haven. The bottom support for gold prices in 2025 is expected to be US$2,500 – 2,600 per ounce. In the long run, due to anti-globalization and concerns about the credibility of the US dollar, global investment demand for gold, central bank net purchases and technology demand may remain strong, while supply may remain relatively stable; improvements in the supply and demand pattern may cause gold prices to fluctuate upwards.

The Minsheng Securities Research News pointed out that under the macro narrative of global currency overissuance, weakening of the US dollar’s credit, warming of the geopolitical situation, and rising potential risks of secondary inflation in the United States, foreign tariff policies, setbacks in returns on overseas risky assets, and continued purchases of gold by global central banks are represented by further strengthening the safe-haven value and value-preserving function of gold. With the sharp rise in gold prices, the gold bull market began to accelerate. Considering that the current U.S. interest rate cut cycle may continue for a long time, there is still a lot of room for gold prices to rise in the future.

Although brokers have generally agreed on the overall trend of gold prices, their views on short-term trends are divided. Some brokerages are optimistic about short-term upward elasticity, some brokerages predict higher points, and some brokerages warn that it is not advisable to chase higher prices in the short term.

UBS said gold will continue to be supported throughout the year amid increasing uncertainty, an extended global interest rate cut cycle and strong demand from investors and central banks. The upward trend in gold prices is expected to continue, and the gold price forecast for the next 12 months will be raised to US$3000 per ounce.

Shenwan Hongyuan Research Report pointed out that gold prices have a trend upward potential. Although recent non-linear changes in positive factors or profit-taking may lead to a short-term correction in gold prices, the central bank’s gold purchases + Trump policy uncertainty will still drive gold prices to a new high in 3 – 6 months. In terms of tactical timing, it is recommended to pay close attention to the incremental changes in China ETFs and changes in U.S. bond interest rates. A surge in U.S. bond interest rates usually lead to a better allocation of gold.

CITIC Securities Research News said that based on the gold price analysis framework, it is optimistic about the gold price in 2025. Under neutral assumptions, COMEX gold futures prices can reach more than US$3100/ounce in mid-2025.& ldquo; Central bank gold purchases around the world are expected to continue, and the declarative effect of central bank announcements on gold purchases may become more obvious. The enthusiasm for gold investment in the global market may continue, structurally, perhaps lower in Asia and higher in Europe and the United States. Geophysical conflicts such as the Middle East and Russia and Ukraine may become more unstable in 2025, which will help gold prices rise. In the medium term, cryptocurrency and gold will not yet form a competitive relationship in safe-haven allocation.& rdquo;

Guosheng Securities Research News holds a conservative attitude. In the medium and long term, gold is likely to continue its upward trend, but it is difficult for 2025 to repeat the market that continued to surge in 2024. It is more likely to be a volatile and repeated rise. It is recommended to wait for the correction. Allocation opportunities should not be chasing high in the short term. rdquo;

Up to 200 billion yuan of insurance funds can enter the market

In this gold craze, insurance funds have also received high attention and are an incremental fund.

On February 7, the State Administration of Financial Supervision and Administration issued the “Notice on Carrying out the Pilot Project of Insurance Funds Investing in Gold Business”, approving the approval of PICC Property Insurance, China Life Insurance, Taiping Life Insurance, Export Credit Insurance, Ping An Property Insurance, Ping An Life Insurance, CPIC Life Insurance, Taikang Life Insurance, and Xinhua Life Insurance to carry out pilot projects for insurance funds investing in gold business, aiming to broaden the channels for the use of insurance funds and optimize the insurance asset allocation structure.

Soochow Securities Research Report calculates based on the total assets (approximately 19.95 trillion yuan) of 10 pilot insurance companies during the latest reporting period, and the upper limit of investable gold is approximately 200 billion yuan.

CITIC Securities Research News also stated that the theoretical upper limit for insurance companies to invest in gold during the pilot period is estimated to be about 200 billion yuan. At the level of allocation value, gold has long had a high revenue-risk-performance ratio, and its correlation with traditional assets has been further reduced in recent years. Adding gold to the traditional stock and bond portfolio can significantly improve the effective frontier of the portfolio.

The CITIC Construction Investment Research Report pointed out that based on the unilateral turnover of the China Gold Exchange of 17.33 trillion yuan (2024), the investment scale of the insurance capital pilot is relatively limited. Therefore, the direct impact of this pilot liberalization on domestic gold prices is limited, and more attention should be paid to derivative significance. Although the investment quota of the pilot is strictly limited, if this model is successfully replicated and promoted in the future, it may enhance gold’s position in the investment portfolio.

In addition, for insurance funds, the important significance lies in the investment side, which broadens investment channels, optimizes the asset allocation structure, and is expected to improve investment performance.

Guojin Securities pointed out that gold investment has many advantages such as risk diversification, value preservation and appreciation, and strong liquidity, which is conducive to alleviating the downward pressure on the yield of traditional fixed-income assets in a low interest rate environment and optimizing the insurance asset allocation structure.

For insurance funds, broadening the scope of investment to gold will help provide new high-yield investment opportunities and alleviate the investment pressure brought by downward interest rates. Interest rates have fallen rapidly since 2023. The yield on 10-year treasury bonds has currently dropped to around 1.6%. Investment by listed insurance companies is facing asset shortages. New gold investment options may help improve the performance of insurance investment.

At the level of allocation value, gold has long had a high revenue-risk-performance ratio, and its correlation with traditional assets has been further reduced in recent years. Adding gold to the traditional stock and bond portfolio can significantly improve the effective frontier of the portfolio. (Blue Whale News Wang Wanying wangwanying@lanjinger.com)