Gold’s meteoric rally has caught the attention of the world’s biggest banks, with JPMorgan and Goldman Sachs now predicting the bull run is far from over. The metal smashed through $3,600 an ounce on Wednesday, a record high, capping a 36% surge this year—more than triple the S&P 500’s 10% return over the same period.
JPMorgan strategists say the forces propelling the rally—market unease, political volatility, and a growing lack of faith in U.S. institutions—show no signs of fading. Goldman Sachs goes further, floating a bold scenario in which gold could hit $5,000 an ounce, about 40% above current levels.
At the heart of these bullish calls is a breakdown of trust in U.S. policy. Analysts warn that President Donald Trump’s unrelenting attacks on the Federal Reserve are sowing doubts about the independence of America’s central bank, long seen as the anchor of global financial stability.
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Goldman argues that if Trump’s interference revives the once-dormant “sell America” trade—where investors dump U.S. Treasurys—the shift could spark a massive migration into gold. The firm estimates that if even 1% of the privately owned Treasury market were reallocated into bullion, it would be enough to propel the metal to $5,000.
“Gold remains our highest-conviction long recommendation in the commodities space,” said Goldman analyst Samantha Dart.
The warning lands at a delicate moment. Trump has demanded immediate and aggressive rate cuts, berating Fed Chair Jerome Powell for his handling of monetary policy. For investors, the spectacle has raised fears that the central bank’s ability to act independently—and therefore its credibility in fighting inflation—is slipping.
That fear is now being compounded by a courtroom drama inside the Fed itself. Governor Lisa Cook has filed suit against the Trump administration after the president sought to remove her from her post on the back of mortgage fraud allegations.
The U.S. Justice Department has opened a criminal probe, issuing grand jury subpoenas in both Georgia and Michigan, according to court documents and sources familiar with the matter. The investigation, referred by Trump-appointed Federal Housing Finance Agency Director Bill Pulte, alleges that Cook improperly claimed more than one property as a primary residence on mortgage applications—potentially securing more favorable interest rates. Cook owns homes in Michigan, Georgia, and Massachusetts.
Trump moved to fire her following Pulte’s claims, triggering Cook’s lawsuit to block her removal. Her attorney, veteran Washington lawyer Abbe Lowell, blasted the DOJ’s actions as politically motivated.
“He wants cover, and they are providing it,” Lowell said. “The questions over how Governor Cook described her properties from time to time… are not fraud, but it takes nothing for this DOJ to undertake a new politicized investigation, and they appear to have just done it again.”
Cook insists that she disclosed all three mortgages during the 2022 Senate confirmation process and that any inconsistencies were already reviewed. She argues they cannot now be retroactively used to justify her ouster.
The case—likely to make its way to the U.S. Supreme Court—could set a precedent for how insulated the Fed truly is from presidential power.
Meanwhile, the man leading the probe, Ed Martin, a special assistant U.S. attorney appointed by Attorney General Pam Bondi, wears several other hats. He also chairs the “Weaponization Working Group” and serves as pardon attorney. Martin is simultaneously pursuing probes into Democratic Senator Adam Schiff and New York Attorney General Letitia “Tish” James, both of which have already seen grand juries convened.
For markets, the overlap of politics, law, and central banking is deeply unsettling. Analysts warn that the U.S. could be entering an era not unlike the 1970s, when President Richard Nixon pressured the Fed into keeping rates low, fueling runaway inflation—and sparking one of history’s most dramatic gold booms.
It is believed that the parallels are clear, with a Fed under siege, a president bent on bending monetary policy to his will, and investors fleeing to gold as the ultimate insurance.
That helps explain why JPMorgan and Goldman both see room for this rally to continue. Analysts believe that as long as faith in Treasurys wavers, the precious metal’s allure as a hedge against both inflation and political instability is likely to keep shining.