Gold is poised to extend its historic bull run into 2026, though likely at a more moderate pace than the explosive gains seen in 2025, which saw prices surge by over 60% to close the year at approximately $4,339.65 per ounce.

The primary consensus among major financial institutions like JPMorgan and Goldman Sachs is that the precious metal will consolidate around current record highs and potentially push toward or even surpass $5,000 per ounce by the end of the year. This optimistic outlook is a direct result of global economic and geopolitical uncertainty becoming a structural feature of the market landscape.

The argument for gold in 2026 is not simply one of fear, but of prudential risk management in an increasingly unpredictable world.

The gold price rally is expected to be driven by a confluence of interwoven factors. For years, the traditional “gold playbook” suggested prices were inversely tied to rising real interest rates. However, over the past two years, gold has decoupled from this pattern, climbing despite rate hikes, a clear signal that new, powerful drivers are at play.

This “decoupling” suggests gold is being driven less by Western financial investors reacting to short-term rate changes and more by global structural demand.

In an environment defined by concerns over persistent inflation, sovereign debt levels, shifting monetary frameworks, and geopolitical fragmentation, gold’s role as an asset with no counterparty risk has become preeminent.

The US Federal Reserve is expected to continue with interest rate cuts throughout 2026 to manage a potential economic slowdown. Lower interest rates reduce the opportunity cost of holding non-yielding assets like gold, making it more attractive to investors. A potentially more dovish new Fed chair could accelerate this trend.

Geopolitical tensions, including the ongoing war in Ukraine, Middle East conflicts, and trade disputes, have increased the demand for gold as a safe-haven asset. Central banks, particularly in emerging markets like China and India, have been accumulating gold at near-record rates, in part to diversify away from the US dollar and hedge against sanction risks, providing a strong structural floor for the price.

Even if headline inflation cools, structural inflationary pressures persist, encouraging investors to use gold as a hedge against currency debasement. Concerns over record global debt levels also push investors toward assets with no counterparty risk.

Inflows into gold-backed Exchange-Traded Funds (ETFs) and strong retail demand, such as for gold bars and coins, are expected to remain robust. This high demand competes with relatively inelastic mine supply, putting further upward pressure on prices.

Despite the largely bullish sentiment, the rally is not without risks. A stronger-than-expected rebound in global economic growth or a more aggressive interest rate stance from the Fed could strengthen the US dollar and weigh on gold prices. Additionally, very high prices could dampen demand in the price-sensitive jewellery market, which accounts for a significant portion of global consumption. A major market sell-off could also force some investors to sell gold to cover losses elsewhere.

For investors navigating a world where uncertainty is the only certainty, gold’s fundamental role as a diversifier and store of value has never been more relevant.

Whether it reaches the ambitious $5,000 per ounce mark or consolidates slightly lower, gold is firmly established as a crucial cornerstone of the modern investment portfolio. And while volatility is likely, the path of least resistance for gold prices in 2026 remains to the upside - Agencies