Gold forecasts in 2026: Will the precious metal make a leap to $5000?

Gold experienced unprecedented historic highs in 2025, with prices surpassing $4300 per ounce in mid-October before experiencing slight corrections toward the $4000 level in November, raising serious questions about the trajectory of gold price forecasts for the coming year and the possibility of reaching the $5000 per ounce barrier.

This sharp rise did not come out of nowhere; rather, it was the result of the accumulation of complex economic and geopolitical factors, including a slowdown in global growth and a shift toward gradual monetary easing policies, prompting investors to reallocate their portfolios toward safe-haven assets. Amid increasing uncertainty regarding sovereign debts and trade tensions, gold’s position as a strategic hedge in major investment portfolios has been solidified.

Geopolitical and Trade Factors: The Main Drivers of Price Increase

Geopolitical crises have been a primary pillar driving gold price expectations upward throughout 2025. Specialized reports indicated that political uncertainty increased demand by 7% year-over-year, as major investment funds moved to hedge against emerging market volatility and risks related to global energy supplies.

As crises in the Taiwan Strait escalated and fears of supply chain disruptions grew, spot prices jumped above $3400 per ounce in July, with gold continuing its rise to break the $4300 barrier by mid-October. This historic behavior of gold shows how highly sensitive the metal is to emergent crises, which enhances the likelihood of reaching new record levels in 2026 if uncertainty persists.

Central Banks’ Role in Supporting Demand

Central banks worldwide continued to boost their gold reserves at an accelerated pace, adding 244 tons during the first quarter of 2025 alone, a 24% increase over the five-year quarterly average. Data shows that 44% of global central banks now manage gold reserves, up from 37% in 2024, reflecting a strategic move toward diversification away from the US dollar.

Leading the purchases were China, Turkey, and India, with the People’s Bank of China alone adding over 65 tons for 22 consecutive months, while Turkey increased its reserves to over 600 tons. This trend is expected to remain the main factor supporting global demand until the end of 2026, especially as emerging markets seek to protect their local currencies from exchange rate volatility.

Investment Demand: The Second Strong Wave

Total demand for the yellow metal in Q2 2025 reached 1249 tons, a 3% annual increase, but the value surged by 45% to $132 billion, reflecting strong institutional demand.

Gold ETF (Exchange-Traded Funds) capital inflows (ETFs) resulted in managed assets rising to $472 billion, with holdings increasing to 3838 tons at a growth rate of 6%, approaching a historic peak estimated at around 3929 tons. This indicator reflects unprecedented interest from new individual investors, with data showing that 28% of new investors in developed markets added gold to their portfolios for the first time, driven by optimistic price forecasts and long-term hedging strategies.

Supply-Demand Gap: A Limitation on Declines

Despite global production reaching a record 856 tons in Q1, the slow annual increase of 1% remains insufficient to close the growing gap between accelerating demand and limited supply. The situation was exacerbated by a 1% decline in recycled gold, as holders preferred to retain their metals amid bullish expectations.

Global extraction costs rose to approximately $1470 per ounce by mid-2025, the highest in the last decade, constraining expansion and raising the profitability threshold for mines. This relative scarcity of supply gives gold a bullish edge, supporting price forecasts that any increase in demand could push prices toward new resistances in 2026.

US and Global Monetary Policies: A Key Catalyst

The US Federal Reserve cut interest rates by 25 basis points in October 2025, bringing the rate to the 3.75-4.00% range, marking the second cut since December 2024. Futures markets (FedWatch) anticipated an additional 25 basis point cut during the December 2025 meeting, making it the third of the year, which could push the interest rate toward 3.4% by the end of 2026 under moderate scenarios.

These cuts lead to a decline in real bond yields, reducing the opportunity cost of investing in gold and increasing its attractiveness. The positive effects on gold extend beyond the Fed, including easing policies by other major central banks such as the European Central Bank and Bank of Japan, which weaken local currencies and boost demand for safe assets.

Dollar Movement and Yields: The Clear Inverse Relationship

The dollar index declined by about 7.64% from its peak in early 2025 to November 21, driven by expectations of rate cuts and slowing economic growth. Meanwhile, US 10-year bond yields fell from 4.6% to around 4.07%, a dual decline that strengthened institutional demand for the precious metal.

Bank of America analysts see this trend supporting gold price forecasts for 2026, especially with real yields stabilizing near 1.2%, as investors seek to rebalance their portfolios away from dollar assets, potentially placing gold in a sustainable upward range.

Inflation and Debt: Partners in Price Upside

Major global financial institutions have acknowledged a 35% increase in gold prices in 2025, while the International Monetary Fund (IMF) forecasted that global public debt exceeded 100% of GDP, raising serious concerns about the sustainability of fiscal policies.

Amid these concerns, major investors turned to gold as a hedge against loss of purchasing power. Bloomberg Economics data shows that 42% of large hedge funds increased their positions in gold during Q3 2025, reflecting a growing recognition of gold’s importance in long-term portfolios.

Gold Price Forecasts 2026: Different Scenarios

Major investment banks agree on a forecast range between $4800 and $5000 as a potential peak in 2026, with annual averages between $4200 and $4800.

HSBC predicts that gold could surge to $5000 per ounce in the first half of 2026, with an expected average of $4600 for the entire year. Similarly, Bank of America raised its forecast ceiling to $5000 as a potential peak with an average of $4400, but warned of a possible short-term correction if traders start taking profits.

Goldman Sachs adjusted its 2026 forecast to $4900 per ounce, citing strong expected inflows into gold ETFs and continued central bank purchases. Meanwhile, JPMorgan’s forecasts indicated a potential reaching of approximately $5055 by mid-2026.

Gold Price Outlook in the Middle East

The Middle East region has significantly increased its gold reserves, with the Central Bank of Egypt adding one ton in Q1 2025, and the Central Bank of Qatar adding 3 tons.

Based on global forecasts, the gold price in Egypt is likely to reach around 522,580 EGP per ounce by 2026, representing a 158.46% increase compared to current prices.

In Gulf countries like Saudi Arabia and the UAE, which have stable exchange rates, translating the expected $5000 per ounce price yields estimates of approximately 18750 to 19000 SAR in Saudi Arabia and 18375 to 19000 AED in the UAE, provided that dollar-pegged exchange rates remain stable.

Potential Corrections: The Dark Side of Optimism

Despite bullish forecasts, HSBC warns that upward momentum may weaken in the second half of 2026, with a possible corrective decline targeting the $4200 level if investors start taking profits, though a drop below $3800 is unlikely unless a major economic shock occurs.

Goldman Sachs also notes that sustained prices above $4800 could test the “price credibility” of the market, i.e., the metal’s ability to maintain its levels amid weak real industrial demand.

However, JPMorgan and Deutsche Bank analysts agree that gold has already entered a new price zone that is difficult to break downward, thanks to strategic shifts in investor perception of it as a long-term asset rather than just a short-term trading tool.

Technical Analysis Snapshot: What Does the Chart Say?

Gold closed trading on November 21, 2025, at $4065.01 per ounce, after touching a historic high of $4381.44 on October 20. The price broke the upward channel line on the daily timeframe but still holds the main upward trendline connecting higher lows around $4050.

There is strong support at the $4000 level, a critical zone for determining the next movement. A clear daily close below this level could target the $3800 zone, representing the 50% Fibonacci retracement.

On the other hand, $4200 is the first strong resistance level, opening the way toward $4400 and then $4680. The Relative Strength Index (RSI) is at 50, indicating a neutral state between buying and selling pressures, while the MACD confirms the overall bullish trend.

Technical analysis suggests that gold will likely continue trading within a sideways upward channel between $4000 and $4220 in the near term, with the overall picture remaining positive as long as the price stays above the main trendline.

Summary: Waiting for a Pivotal Phase

Gold price forecasts for 2026 reflect an expected struggle between profit-taking and new buying waves from central banks and major investors. If real yields continue to decline and the dollar remains weak, the precious metal is poised to record historic highs potentially exceeding $5000 per ounce.

However, if inflation subsides and confidence returns to traditional financial markets, gold may enter a long-term stabilization phase that prevents reaching these ambitious levels. Ultimately, gold price forecasts for 2026 will heavily depend on the dynamics of economic and political factors that will determine the market’s path in the coming months.