As global economic momentum falters across most regions, a new World Bank report projects a bright spot for precious metals. Despite growth being slashed in nearly 70% of economies worldwide, gold, silver, and platinum are expected to defy the slowdown with over 30% price growth in 2025, according to the World Bank’s latest Global Economic Prospects (GEP) report.
📉 Global Growth Outlook Weakens Sharply
The World Bank forecasts global growth will slow to 2.3% in 2025, nearly 0.5% lower than earlier estimates. While a global recession is not anticipated, the pace of expansion is on track to be the weakest in over half a century.
“If these forecasts hold, average global growth for the first seven years of the 2020s will mark the slowest decade since the 1960s,” the report noted.
This economic slump has triggered downward revisions in growth projections across all regions and income groups, with developing economies hit hardest. Growth in these nations is expected to average just 3.8% in 2025, significantly below the 2010s average.
💬 “Development-Free Zone” for Many Nations
World Bank Chief Economist Indermit Gill issued a stark warning:
“Outside of Asia, the developing world is becoming a development-free zone. Growth has declined from 6% in the 2000s to under 4% now.”
The report also highlights:
- Trade growth has dropped below 3% this decade
- Investment growth remains sluggish
- Global debt is at record highs
🔺 Precious Metals Set to Outperform in 2025
While most commodity prices are projected to decline by 10% in 2025 due to trade disruptions and weak demand, precious metals are set to surge.
“The precious metals price index—led by gold, silver, and platinum—is expected to increase by more than 30% in 2025,” the report states.
Key drivers include:
- Safe-haven demand as economic uncertainty persists
- Trade tensions driving investor flight to stability
- Monetary policy shifts in major economies
Gold prices, in particular, are expected to reach record annual averages, potentially breaching $3,400 per ounce, while silver and platinum are forecast to follow suit due to strong industrial and investment demand.
⚖️ Industrial Metals to Lag Behind
In contrast, base and industrial metals such as copper and aluminum are facing headwinds. The metals index is projected to decline 5% in 2025 and trend lower in 2026. Weak manufacturing and policy uncertainty are weighing heavily on demand.
🌐 Commodity Price Risks Remain
The World Bank cautioned that the outlook for commodities is still fragile:
- A re-escalation in US-China trade tensions could undermine demand.
- Geopolitical shocks may distort supply chains.
- Climate events could impact agricultural commodities, affecting inflation trends.
📊 Conclusion: Precious Metals Offer a Rare Bright Spot
In a year where global growth is expected to falter, gold, silver, and platinum may prove to be resilient investment options. With projected price gains exceeding 30%, investors and policymakers alike will be watching the precious metals market closely as a potential hedge against broader economic headwinds.
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