Despite the year not yet being over, gold investors have good reason to celebrate early: the precious metal is on track for a stellar annual performance, potentially marking its best year since 1979.
Rajat Bhattacharya, Senior Investment Strategist at Standard Chartered, noted in a 2026 outlook report that gold has outperformed both stocks and bonds for the second consecutive year and has beaten bonds for a decade straight. "Driven by geopolitical uncertainty and concerns over global fiscal easing, gold has surged over 50% this year and more than 150% in the past three years," he said. "We firmly believe gold will continue to outperform global equities and bonds in 2026."
While the market broadly expects the rally to extend into 2026—given favorable conditions—analysts are tempering overly optimistic forecasts. Bhattacharya projects an average gold price of $4,500 per ounce over the next 12 months. "Despite some relative valuation metrics suggesting gold is already elevated, strategic and cyclical factors indicate that the current technical pullback presents a buying opportunity for underweight investors," he added. "Our balanced asset allocation strategy maintains a 7% gold weighting."
Meanwhile, a growing number of analysts predict gold could reach $5,000 per ounce next year. However, this would represent a 16% gain—significantly lower than this year’s surge and the 27% rise in 2024. Carsten Fritsch, Commodity Analyst at Commerzbank, pointed out that gold prices have doubled since February 2024, adding that the current pace of gains is unsustainable. The German bank forecasts gold to rise to $4,400 per ounce in 2026.
Chantelle Schieven, Research Director at Capitalight Research, remains bullish on gold but acknowledges valid concerns about its momentum. "After two exceptional years, it’s reasonable to question whether this rally can persist," she said. "Gold may be in bubble territory, but that doesn’t mean the bubble will burst next year. Structural shifts in global financial markets continue to support long-term gains, and $5,000 in 2026 seems plausible."
Schieven highlighted strong technical support at higher price levels. Gold held above $2,000 in 2024, established a new floor at $2,500 early this year, and quickly climbed to $2,800. By mid-year, a $3,000–$3,500 support range emerged, serving as the launchpad for October’s record high of $4,366.
Aakash Doshi, Chief Gold Strategist at State Street Investment Management, expects gold to consolidate between $4,400 and $4,500 next year but sees upside risks. "$3,000 is the new $2,000, and now $4,000 is becoming the new $3,000," he told Kitco News. "With this robust support, I believe the next 25% move will still be upward."
A key reason for sustained bullishness is that core market drivers are unlikely to change significantly. Michael Widmer, Head of Metals Research at Bank of America, noted in an annual outlook webinar that gold bull markets typically peak only when their initial catalysts fade—not merely due to price appreciation. BofA’s official forecast projects an average gold price of $4,538 in 2026, with a potential high of $5,000.
Gold’s rally, which began in late 2022, has been underpinned by strong central bank demand. Global official reserves have added over 3,000 metric tons in the past three years. While 2025 data remains preliminary, the World Gold Council estimates central banks will add 750–900 tons this year. Analysts attribute this trend to de-dollarization efforts after the U.S. and allies weaponized sanctions against Russia post-Ukraine invasion. The 2025 global trade war further accelerated reserve diversification away from dollar dependence.
2025 marked a historic milestone as central bank gold holdings surpassed U.S. Treasury reserves for the first time. Gold now averages 15% of central bank reserves, but Widmer’s models suggest optimal allocation would approach 30%.
While central banks will continue providing a floor, some analysts expect retail investors to dominate next year. Schieven predicts rate cuts and sticky inflation will drive more investors from bonds to gold. "With real yields declining, bonds no longer offer their traditional value or safety," she said. Doshi added that gold’s role as a portfolio diversifier will grow in 2026 given persistently high stock-bond correlation. "If this correlation remains elevated, gold’s appeal as a hedge against tail risks will only increase," he stated.
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