Gold in 2026: Will the ounce of gold reach new record levels?

The year 2025 was a true turning point in gold prices, as we witnessed wild jumps pushing the price to touch $4,300 per ounce in October, before retreating toward $4,000 in November. This volatility raised a burning question in investors’ minds: will we see $5,000 levels in 2026, or is gold approaching its price ceiling?

Why did gold rise so boldly in 2025?

The annual average of gold in 2025 reached about $3,455 per ounce, but the truth is more complex than just a number. Global central banks are buying gold at a frantic pace — adding 244 tons in the first quarter alone, a rate exceeding the historical average by 24%. Now, 44% of central banks worldwide hold gold reserves, compared to only 37% in 2024. This is no coincidence — it reflects a genuine desire to move away from US dollar dominance.

On the other hand, individual investors entered the market strongly. Data indicates that 28% of new investors in developed markets added gold to their portfolios for the first time last fall. Gold ETFs attracted massive capital, with assets under management reaching $472 billion, and holdings totaling 3,838 tons — very close to the all-time peak of 3,929 tons.

Total demand for gold in Q2 2025 was 1,249 tons valued at $132 billion — a 45% increase from last year. North America alone accounted for more than half of global demand with 618.8 tons from the start of the year through September.

Supply side: the scarcity supporting prices

This is where the real secret to gold’s strength lies. Record mining production reached 856 tons in Q1, but this slow increase of only 1% does not come close to closing the gap with rising demand. Even worse — recycled gold decreased by 1%, as owners prefer to hold onto their pieces in hopes of further appreciation.

Extraction costs have become a decisive factor. The average cost to produce an ounce of gold hit $1,470 in mid-2025 — the highest in a full decade. This means expanding production will not be easy or cheap, sustaining the relative scarcity that supports high prices.

Federal Reserve: rate cuts support gold

In October 2025, the US Federal Reserve cut interest rates by 25 basis points to 3.75-4.00%. This is the second cut since December 2024, and futures markets price in a third cut of 25 basis points at the December meeting.

The World Bank projects the Fed’s rate to reach 3.4% by the end of 2026 in the moderate scenario. Every rate cut reduces the opportunity cost of holding gold — an asset that yields no interest — making it more attractive as a safe haven.

Other central banks stay on course

Global monetary policies are diverging. While the Fed is easing, the European Central Bank continues tightening to combat inflation, but the Bank of Japan remains accommodative. This divergence further enhances gold’s role as a global hedge that transcends policy differences.

Inflation and sovereign debt: a real threat

The International Monetary Fund warned that global public debt has surpassed 100% of GDP — a level unseen before. This creates waves of concern over the sustainability of fiscal policies.

The World Bank expects gold prices to rise by 35% in 2025, but with forecasts for next year likely to decline if inflation pressures ease. Nonetheless, even with the expected slowdown, prices will remain historically high.

About 42% of major hedge funds increased their gold holdings during Q3 2025 — clear evidence that institutions are buying gold as long-term insurance against financial risks.

Geopolitical crises: a hidden driver

Tensions between the US and China, along with instability in the Middle East, increased demand for gold by 7% annually. When fears escalated around the Taiwan Strait, spot prices jumped to $3,400 in July. As uncertainty persisted, gold continued rising to break the $4,300 barrier in October.

Dollar and bonds: the well-known inverse relationship

The dollar index declined by 7.64% from its peak at the start of the year through November 2025. Simultaneously, US 10-year bond yields fell from 4.6% to 4.07% in the same period.

This double decline in the dollar and real yields (remaining stable near 1.2%) created an ideal environment for gold. Investors seek balance in their portfolios away from dollar assets, supporting demand for the yellow metal.

Outlook for 2026: where is gold headed?

HSBC bets on a strong rally, expecting gold to reach $5,000 per ounce in the first half of 2026, with an average of $4,600. This is a jump from the $3,455 (2025 average).

Bank of America also raised its forecast to $5,000 as a potential peak, with an expected average of $4,400, but warned of a possible short-term correction if investors start taking profits.

Goldman Sachs adjusted its forecast to $4,900 per ounce, citing stronger inflows into gold ETFs and continued central bank purchases.

J.P. Morgan is more optimistic — expecting around $5,055 by mid-2026.

Consensus among top analysts points to a potential peak range of $4,800–$5,000, with an average between $4,200–$4,800.

In the Middle East: local figures

Gold price forecasts in the region reflect the same global trends with local adjustments:

In Egypt, the expected ounce price is around 522,580 EGP — an increase of 158.46% compared to current prices.

In Saudi Arabia and the UAE, assuming an ounce price of $5,000 with stable exchange rates (3.75-3.80 SAR/USD) and (3.67 AED/USD), we might see prices approaching 18,750–19,000 SAR and 18,375–19,000 AED per ounce.

Of course, these forecasts depend on currency stability and continued global demand without major economic shocks.

Could gold decline instead of rising?

Despite optimism, HSBC warned that momentum might weaken in the second half of 2026, with a correction possibly down to $4,200 if investors start booking profits. However, they exclude a drop below $3,800 unless a real economic shock occurs.

Goldman Sachs warned that prices staying above $4,800 could test the market’s “price credibility” — meaning the ability of gold to sustain high levels amid weak industrial demand.

But analysts at J.P. Morgan and Deutsche Bank agree that gold has entered a new price zone that’s hard to break downward, thanks to a strategic shift in investor perception of it as a long-term asset rather than just a short-term speculative tool.

Technical analysis: what does the chart say?

Gold closed trading on November 21, 2025, at $4,065 per ounce, holding the main short- and medium-term uptrend line. The $4,000 level acts as strong support — breaking below could target $3,800 (50% Fibonacci retracement level).

The RSI remains at 50, indicating a neutral market — neither overbought nor oversold. This suggests a waiting phase before a new trend emerges.

The MACD stays above zero, confirming the overall bullish trend. Technical analysis suggests gold will trade within a sideways upward range between $4,000 and $4,220 in the near term, with the overall picture remaining positive as long as it stays above the main trend line.

The most important point: the macroeconomic environment

Ultimately, gold price forecasts depend on one question: will real yields continue to decline and the dollar remain weak? If yes, gold is poised to reach new all-time highs at $5,000 or more.

But if inflation genuinely subsides and confidence returns to financial markets, gold may enter a long-term stabilization phase, preventing the achievement of targeted levels.

Summary: 2026 will be a decisive year for gold prices — either toward historic peaks or a reasonable correction phase. All depends on how economic and geopolitical factors evolve, which remain uncertain at this stage.