In Indian rupee, gold could surge from Rs 27,000 to Rs 35,000 per 10 gram, without adjusting for exchange rate and duties, if his forecast comes true.
"I'm positive that gold will go up substantially (in 2015) say 30 per cent," Market Watch quoted Dr Faber as saying at Societe Generale's global strategy presentation in London on Tuesday. (Read)
Dr Faber's forecast comes at a time when the yellow metal has struggled and significantly underperformed equites over the last few years. The last time gold investment yielded significant return was in 2010, when the precious metal jumped 27 per cent, according to data from goldprice.org.
Gold prices made a "top" in September 2011 rising to a record high of $1921.50. In 2012, they rose just 7 per cent.
2013 marked the big reversal for gold, as prices crashed by 28 per cent in first drop in 13 years. In 2014, gold declined by 1.5 per cent. It is currently trading around $1,230 an ounce.
According to Dr Faber, stock, bond and real estate prices are high because interest rates and short-term deposits are near zero, while precious metals are inexpensive.
"My belief is that the big surprise this year is that investor confidence in central banks collapses. And when that happens - I can't short central banks, although I'd really like to, and the only way to short them is to go long gold, silver and platinum," he said.
Like his many other bets, Dr Faber's bullishness about gold seems to be "contrarian" as many other commodity experts expect the yellow metal to languish. Jim Rogers, one of best-known investors, is in no hurry to buy gold.
"Gold went up for 12 years in a row without a down year, which is extremely unusual in markets. So in my view the correction will be unusual as well. Gold has not had a 50 per cent correction in years, which too is unusual. That would be $960 per ounce," Mr Rogers said in an interview.
Most big investment banks are also bearish on gold. ABN Amro commodity strategist Georgette Boele told Reuters, "A new drop in gold prices driven by a stronger dollar and higher US interest rate expectations is likely in 2015, when we see prices average $1,000 an ounce."
Analysts from Barclays also expect gold prices to test new lows in 2015. Goldman Sachs and Societe Generale SA also predict further losses in gold prices in 2015. (Read)