Market News

Investing.com --Analysts expect gold prices to finish below current levels, but have raised their 2026 forecasts due to strong central bank demand and ongoing global economic uncertainty.

"The price of Gold is driven mostly by investor sentiment about the US dollar and debt levels of the United States. I think worries about those are fading as geopolitics and midterm elections take over. I expect gold to trade below $4500 by the end of 2026," Michael Antonelli, Market Strategist for Baird Private Wealth Management, told Investing.com.

According to a survey by Reuters that included 31 analysts and traders said that they expect median gold price of $4,916 per troy ounce for 2026, marking the highest annual forecast since Reuters began tracking in 2012. The survey said the price represents an increase from the $4,746.50 estimate issued three months earlier, and a sharp jump from last year’s $3,000 projection.

Gold prices, which surged to a record high of around $5,595 per ounce in late January, have since declined about 11%. The drop followed military strikes by the United States and Israel on Iran in late February, as investors moved to secure liquidity.

Despite recent volatility, analysts expect gold’s broader rally to resume once geopolitical tensions ease. However, its traditional role as a hedge against inflation is being challenged by expectations of tighter monetary policy, as elevated energy prices could prompt central banks to maintain high interest rates—typically a negative factor for non-yielding assets like gold.

"A key catalyst for gold to move meaningfully higher would be the Federal Reserve cutting rates, particularly if that results in real yields moving lower. From a technical perspective, we would also like to see gold move back above its 50-day moving average and the mid-April peak to signal that the consolidation phase is ending," said Keith Lerner, Chief investment officer and chief market strategist at Truist.

Key drivers supporting gold prices include continued central bank purchases, concerns over the independence of the Federal Reserve, rising U.S. debt levels, and fears of currency debasement.

"Supportive longer-term forces remain in place, but we expect a more range-bound and volatile path and will look to improved technicals for confirmation the uptrend is resuming. In the interim, gold continues to serve a role as a portfolio diversifier," Lerner added.

Overall, precious metals are expected to remain sensitive to geopolitical developments and monetary policy shifts in the coming years, Reuters report said.