In a landscape marked by escalating macroeconomic uncertainty and growing divergence across asset classes, David Barrett, CEO of EBC Financial Group (UK) Ltd, has called on global investors to reduce leverage, diversify carefully, and prepare for unpredictable conditions. His insights were shared during a feature interview broadcast on China Central Television (CCTV), where he outlined a measured strategy for investing in turbulent times.
The interview included representatives from Goldman Sachs, Citigroup, and JPMorgan, who discussed the shifting dynamics in global asset allocation and the evolving strategic role of gold as a hedge against risk.
From Record Highs to Volatility: Gold’s Recent Journey
Gold experienced a remarkable rally in early 2025, climbing over 25 percent year-to-date and briefly surpassing $3,500 per ounce. This surge outpaced gains in equities and commodities, underscoring persistent investor risk aversion even as U.S. stocks made moderate advances and oil markets declined.
However, as reported by CCTV, gold prices retreated more than 5 percent in May. The pullback followed easing trade tensions and a notable decline in the U.S. Consumer Price Index (CPI) to 2.3 percent in April, which tempered inflation expectations and softened gold’s appeal as an inflation hedge.
“People should be conservative with their leverage and their exposure,” Barrett advised. “Keep your powder dry so you can react to these ever-changing news cycles. It gives you the opportunity to exploit moves when they come along.”
Sovereign Debt Worries and Long-Term Risks
Barrett highlighted mounting structural risks in sovereign debt markets. On May 17, 2025, Moody’s downgraded the U.S. sovereign credit rating from Aaa to Aa1, removing its final top-tier rating. Coupled with weak demand at recent 20-year U.S. and Japanese bond auctions, this downgrade has driven long-term yields to multiyear highs and heightened investor concerns.
“This isn’t about risk aversion—it’s about intelligent positioning,” Barrett said. “Gold is not just a safe haven—it’s a barometer for uncertainty.”
Central Banks and Market Forecasts
Goldman Sachs projects gold prices to reach $3,700 by the end of 2025, while JPMorgan forecasts $4,000 per ounce by the second quarter of 2026. Conversely, Citigroup has cautioned that declining retail demand may pressure prices beyond 2026.
Barrett stressed the importance of balancing optimism with caution amid diverging monetary policies and fragile geopolitical tensions.
As gold moves from a sustained bull market into a more volatile, repositioning phase, Barrett reiterated EBC Financial Group’s commitment to guiding investors through complexity.
“We remain committed to helping our clients build resilient, forward-looking portfolios. That means understanding when to act, and when to step back,” he concluded.
