Gold Price Predictions 2026.. Will it Rise Towards $5000?

Strong Beginnings: Gold’s Leap in 2025

The year 2025 started with positive surprises for gold, as the precious metal experienced an unexpected rally that pushed it to surpass the $4300 per ounce mark in mid-October 2025, before retreating to levels around $4000 in November. This volatility raised serious questions among traders and investors about what lies ahead for the valuable metal in the coming year and its potential to reach the $5000 mark.

The truth is, this rise did not come out of nowhere; it was a direct result of deep economic concerns looming on the horizon, as major economies began showing signs of slowdown, and expansionary monetary policies gradually resumed. Investors quickly moved toward safe-haven assets, primarily gold, especially amid increasing fears of sovereign debt issues and supply chain tensions.

Global Demand: A New Record

Recent data indicate that total demand for gold reached 1249 tons in Q2 2025, a 3% annual increase, but financial figures are even more telling, with the value reaching $132 billion, a strong jump of 45%.

Exchange-traded gold funds also saw record inflows, with managed assets rising to $472 billion, and holdings increasing to 3838 tons, close to the historical peak. This means millions of new investors entered the gold market, according to available data, especially in the US and European markets.

Central Banks’ Role: Strategic Shift

The pivotal role played by central banks in supporting gold prices cannot be ignored. Central banks worldwide added 244 tons in Q1 2025 alone, a level 24% higher than the five-year quarterly average.

Numbers indicate a real shift in reserve strategies, with 44% of central banks managing gold reserves, compared to only 37% in 2024. China, Turkey, and India led the buying spree, with China alone adding more than 65 tons during the same period, continuing this trend for the twenty-second consecutive month.

This shift is not random; it reflects a growing desire among emerging economies to diversify their reserves away from full reliance on the US dollar.

Supply Dilemma: Scarcity Drives Prices

While demand surged sharply, supply remained limited. Mine production in Q1 2025 reached 856 tons, a very slight increase of only 1%. This minimal increase is insufficient to bridge the widening gap between demand and supply.

The situation was further complicated by a 1% decline in recycled gold, as owners of gold jewelry preferred to hold onto their assets in anticipation of further increases. Additionally, global extraction costs rose to around $1470 per ounce, the highest in a decade, constraining production expansion. This supply shortage exerts strong upward pressure on prices.

Monetary Policy: Rate Cuts Support Expectations

The US Federal Reserve cut interest rates by 25 basis points in October 2025 to the range of 3.75-4.00%, marking the second cut since December 2024. The communicated signals suggest further cuts are possible if the strength of the labor market weakens or economic growth slows.

Market expectations price in an additional 25 basis point cut during the December 2025 meeting, which could be the third reduction of the year. In certain scenarios, the Fed might reach an interest rate of 3.4% by the end of 2026.

These cuts directly impact gold, leading to a decline in real bond yields, which reduces the opportunity cost of holding gold as a non-yielding asset and increases its appeal as a safe haven.

Dollar and Bonds: A Negative Duo

The dollar index declined by 7.64% from its peak at the start of the year until the end of November 2025. Simultaneously, 10-year US Treasury yields fell from 4.6% in Q1 to 4.07% at the end of November.

This double decline creates a perfect environment for gold, as a weaker dollar makes the metal cheaper for foreign buyers, while lower yields reduce the relative cost of holding it. Analysts see that continuation of this trend could support expectations for 2026, especially with real yields stabilizing around 1.2%.

Geopolitical Risks: An Additional Demand Factor

Trade conflicts and regional tensions have prompted investors to increase their exposure to gold, with geopolitical uncertainty boosting demand by 7% year-over-year. When concerns about supply disruptions and trade disputes escalated, prices surged to their highest levels.

Any new geopolitical shock in 2026 could push prices to new record highs.

Major Bank Forecasts: Consensus on Rise

The largest financial institutions have sharply raised their forecasts for 2026:

• HSBC expects gold to reach $5000 in the first half of 2026, with an annual average of $4600
• Bank of America raised its forecast to $5000 as a peak, with an average of $4400
• Goldman Sachs adjusted its forecast to $4900
• J.P. Morgan predicts gold will reach around $5055 by mid-2026

The most consensus range among analysts is between $4800 and $5000 as a peak, with an average between $4200 and $4800.

Correction Warnings: Bearish Scenario

But not all outlooks are rosy. Several banks warned of a correction down to around $4200 in the second half of 2026 if investors start taking profits. Analysts also cautioned that prices remaining above $4800 could test price credibility due to weak industrial demand.

However, a drop below $3800 is unlikely unless a major economic shock occurs, indicating that the ground beneath gold remains relatively strong.

Technical Analysis: Support and Resistance

On the daily chart, the price closed at $4065 per ounce at the end of November, after touching a high of $4381.44 in October. The price holds above the main upward trendline around $4050 in the short term.

Strong support is at $4000, and if broken, the next target could be $3800 (50% Fibonacci retracement). On the upside, $4200 is the first strong resistance, followed by $4400 and $4680.

Momentum indicators show a completely neutral state, with a balance between bearish and bullish pressures. Technical analysis suggests continued sideways trading within an upward-sloping range between $4000 and $4220 in the near term.

Middle East Outlook

In Egypt, according to multiple forecasts, gold could reach around 522,580 Egyptian pounds per ounce in 2026, representing a 158.46% jump compared to current prices.

In Saudi Arabia and the UAE, if we translate the global forecast of around $5000 into local currencies at stable exchange rates, the price could approach 18,750 to 19,000 SAR per ounce, and around 18,375 to 19,000 AED.

Summary: A Clash of Hopes and Realities

Gold price forecasts for 2026 reflect a clear struggle between strong bullish factors and realistic reservations. On one hand, structural data (demand, central bank purchases, limited supply, and accommodative monetary policies) all support expectations of a sharp rise toward $5000.

On the other hand, current price levels are very high, and portfolio rebalancing and profit-taking could hinder a downward correction. The final decision will depend on how the global economy evolves, whether accommodative policies continue unchanged, and whether new geopolitical shocks occur.

What is certain is that gold has entered a critical period where specific conditions are needed to sustain momentum toward record levels in 2026.