Will gold make its journey to $5000 in 2026?

Gold market in 2025 experienced significant volatility, starting from an average of $3,455 per ounce and reaching a record high of $4,381 in mid-October, before retreating to around $4,065 by the end of November. This sharp movement sparked intense discussions in financial circles about what lies ahead for the yellow metal in the coming year.

Factors Supporting Gold Price Rise in 2026

Continued demand from new investors and institutions

Data indicates a qualitative shift in investor behavior. Bloomberg statistics show that 28% of new investors in developed markets added gold to their portfolios for the first time last year, maintaining their positions even during short-term corrections.

On the other hand, inflows into gold ETFs( surged to $21 billion in the first half of 2025 alone, pushing managed assets to $472 billion, a 6% increase from the previous quarter. This growth approaches the historical peak of 3,929 tons and reflects growing confidence among institutional investors in the metal’s future.

Central banks continue accumulation

Purchases by central banks did not stop. Global central banks added 244 tons in Q1 2025 alone, a 24% increase over the five-year quarterly average. China led this expansion with a 65-ton addition in the first half, marking 22 consecutive months of buying, while Turkey increased its reserves above 600 tons.

The clearest indicator is that 44% of central banks worldwide now manage gold reserves, up from only 37% in 2024. This reflects a strategic desire to diversify assets away from the dollar, a trend expected to continue strongly throughout 2026.

Supply and demand dilemma

Although mine production hit a record )856 tons in Q1(, this slight increase of 1% did not keep pace with the surge in demand. The situation is worsened by a 1% decline in recycled gold, as holders prefer to keep their holdings in anticipation of further increases.

Additionally, extraction costs rose to $1,470 per ounce by mid-2025, the highest in a decade, limiting production expansion and deepening supply shortages.

Loose monetary policies

The US Federal Reserve has cut interest rates twice since December 2024, the latest by 25 basis points in October to 3.75-4.00%. Markets expect a further 25 basis point cut in December 2025. According to BlackRock reports, the Fed may target an interest rate of 3.4% by the end of 2026.

This trend reduces real yields on bonds, lowering the opportunity cost of investing in non-yielding assets like gold, thereby enhancing its appeal as a safe haven.

Weak dollar and geopolitical tensions

The dollar index has declined about 7.64% from its peak since the start of 2025 through November. Simultaneously, 10-year US bond yields fell from 4.6% to 4.07% over the same period. This double decline boosts gold’s attractiveness to foreign investors.

On the geopolitical front, Reuters reported that geopolitical uncertainty in 2025 increased demand for gold by 7% annually. Continued or escalating tensions in 2026 could further reinforce the metal’s role as a safe haven.

Major Investment Bank Outlooks

Major banks’ forecasts lean towards cautious optimism:

HSBC expects gold to surge toward $5,000 in the first half of 2026, with an annual average of $4,600.

Bank of America raised its forecast to $5,000 as a potential peak, with an average of $4,400, but warned of a short-term correction for profit-taking.

Goldman Sachs adjusted its forecast to $4,900 per ounce, supported by strong inflows into gold funds and continued central bank purchases.

J.P. Morgan predicts gold reaching around $5,055 by mid-2026.

Consensus points to a range between $4,800 and $5,000 as a potential peak, with an annual average between $4,200 and $4,800.

Challenges and Risks

The picture is not without shadows. HSBC warned of a possible correction to around $4,200 in the second half of 2026 if investors widely take profits, excluding a deeper drop below $3,800 unless a major economic shock occurs.

Goldman Sachs warned that prices sustained above $4,800 could face a “price credibility test,” especially with limited industrial demand impact.

However, J.P. Morgan and Deutsche Bank analysts agree that gold has entered a new price zone that is difficult to break downward, thanks to the strategic shift in investor perception of it as a long-term asset.

Technical Outlook at the Start of 2026

Gold maintains the main upward trendline on short- and medium-term charts, with strong support at $4,000. Breaking this level with a clear daily close could target $3,800 )50% Fibonacci( before resuming upward movement.

On the resistance side, $4,200 is the first strong barrier, followed by $4,400 and $4,680. The RSI) stands at 50, indicating full market neutrality without clear overbought or oversold signals. The MACD remains above zero, confirming the overall bullish trend.

Technical analysis suggests gold will stay within a sideways range leaning upward between $4,000 and $4,220 in the near term, with the overall picture remaining positive as long as it stays above the main trendline.

Summary

The question “Will gold price rise in 2026?” seems to lean more towards the positive than the negative. With declining real yields, a weak dollar, ongoing central bank buying, and strong institutional demand, multiple factors support higher levels.

The main risk lies in widespread profit-taking and any unexpected economic shock. But as long as the fundamental factors remain unchanged, reaching $5,000 in 2026 is not far-fetched. The final outcome will depend on how the market balances the desire to realize profits against ongoing buying pressure.