Gold likely to touch $5,000 in 2026 amid macro tail events: Report
Gold’s rally picked up pace on Tuesday as a leading Wall Street bank projected an average price of $4,538 per ounce in 2026, with the potential for the metal to surge as high as $5,000 if macroeconomic tailwinds persist and safe-haven demand stays firm.
Spot bullion hovered near $4,175 per ounce, with traders increasingly betting on a US Federal Reserve rate cut in December. Lower policy rates typically support gold by reducing the opportunity cost of holding a non-yielding asset.
In India, benchmark prices reflected the global momentum. At mid-session, 10 grams of 24-carat gold were quoted around Rs 1,25,342, up from roughly Rs 1,23,308 a day earlier, according to industry data.
Despite recent gains, strategists argue the metal still has room to run. They describe the market as simultaneously “overbought” in the near term yet “underinvested” from an institutional allocation standpoint, suggesting that any pullbacks could be met with renewed buying from investors still light on exposure.
Analysts outlined several forces that could propel prices toward the $5,000 mark in 2026:
- Stubborn inflation that keeps real yields compressed
- Elevated government debt burdens globally
- A trend toward lower interest rates after an aggressive tightening cycle
- An unconventional US policy mix that has historically coincided with gold strength
They also flagged key watch points that could shape the path higher: a cooling in Chinese demand, tightness across mined metal supply chains, and historically lean inventories — all factors that can amplify price swings if demand remains resilient.
On the risk side, a hawkish detour by the Federal Reserve would be the most notable headwind. Rate-cut expectations jumped after the New York Fed chief suggested that trimming rates would not derail progress on inflation, a remark that markets interpreted as incrementally dovish. Derivatives pricing now implies roughly an 81 percent chance of a December rate cut, up sharply from about 40 percent a week ago.
Futures mirrored the upbeat tone. On the Multi Commodity Exchange, December gold contracts advanced around 1 percent to approximately Rs 1,25,106 per 10 grams in early trade. Silver participated in the move as well, with December contracts up about 1.34 percent to near Rs 1,56,551 per kilogram.
With policy expectations swinging in gold’s favor and macro uncertainties lingering, the metal’s safe-haven appeal remains firmly in focus. If inflation proves sticky, sovereign debt stays heavy, and central banks pivot toward easier policy, the runway for higher highs may extend well into 2026. Conversely, any decisive pushback from the Fed or a sharp resurgence in real yields could test the durability of this rally.
