Will gold reach $5000? A comprehensive outlook on price movements during 2026

As 2025 approaches its end, investors’ attention is focused on the surprises that gold prices may hold in the coming year. After reaching record highs exceeding $4,300 per ounce in October, serious questions have arisen: Will gold prices in 2026 break the $5,000 barrier? or will the market experience downward corrections?

Major Banks’ Outlook: An Optimistic Picture for Gold Prices

The world’s leading financial institutions unanimously forecast bullish trends:

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

Bank of America raised its forecast ceiling to reach $5,000 as a potential peak, maintaining an expected average of $4,400, but did not rule out short-term corrections for profit-taking.

Goldman Sachs adjusted its expectations to $4,900, based on strong inflows into gold ETFs and the anticipated continued purchases by central banks.

J.P. Morgan indicated the possibility of prices reaching around $5,055 by mid-2026.

The most consensus range among analysts revolves around $4,800 to $5,000 as a potential peak, with an annual average between $4,200 and $4,800.

What Happened in 2025? The Context Shaping Expectations

The year 2025 witnessed an unprecedented journey for gold, surpassing the $4,300 mark in mid-October before falling to around $4,000 in November. The average annual price settled around $3,455 per ounce. This volatility was not random but reflected deep economic and geopolitical factors indicating continued support for prices in the future.

The Eight Factors Determining Gold’s Path in 2026

1. Investment demand at historic highs

The World Gold Council estimated total demand in Q2 2025 at 1,249 tons, up 3% annually, valued at $132 billion (+45%). The first quarter recorded 1,206 tons, the highest since 2016.

Gold ETFs attracted massive inflows, raising assets under management to $472 billion. Holdings reached 3,838 tons, up 6% from the previous quarter, approaching a record high of 3,929 tons.

About 28% of new investors in developed markets added gold to their portfolios for the first time, driven by extensive media coverage and bullish expectations. These investors maintained their positions even during corrections, reinforcing price stability.

North America led demand with 345.7 tons, followed by Europe (148.4 tons) and Asia (117.8 tons).

( 2. Central banks accelerate purchases

Reserves continued to rise, with an addition of 244 tons in Q1 2025 )+24% over the five-year quarterly average###.

44% of global central banks currently hold gold reserves, up from 37% in 2024. This reflects a growing desire to diversify assets away from the dollar.

China alone added more than 65 tons in the first half, continuing a 22-month streak. Turkey increased its reserves above 600 tons.

The expectation is that central bank purchases will remain the main support factor until the end of 2026, especially in emerging markets.

( 3. Limited supply pressures prices

Mine production reached 856 tons in Q1 )+1% annually###, but this figure does not close the gap between rising demand and available supply.

Recycled gold declined by 1% in the same period, as owners preferred to hold onto their pieces in anticipation of further increases, deepening the supply-demand gap.

Global extraction costs rose to $1,470 per ounce in mid-2025, the highest in a decade, limiting the expansion of new production.

( 4. Federal Reserve and US monetary policy

The Federal Reserve cut interest rates by 25 basis points in October to a range of 3.75-4.00%, the second cut since December 2024. Indicators price in an additional 25 basis point cut at the December 2025 meeting.

Fed officials hint at further cuts if the labor market weakens. BlackRock’s forecasts suggest the interest rate could reach 3.4% by the end of 2026.

These cuts reduce real yields on bonds, boosting gold’s appeal as a non-yielding hedge.

) 5. Diverging global monetary policies

The European Central Bank is tightening its stance to combat inflation, while the Fed is easing, and the Bank of Japan maintains its accommodative policy. This divergence has created a volatile environment that has enhanced gold’s role as a safe-haven asset.

6. Global debt and persistent inflation

Global public debt exceeds 100% of GDP, according to the IMF, raising concerns about fiscal sustainability. This has prompted investors to turn to gold as protection against loss of purchasing power.

42% of major hedge funds increased their gold holdings during Q3 2025.

The World Bank projected a 35% rise in gold prices in 2025, expecting a slight decline in 2026 as inflationary pressures ease, but prices will remain historically high.

7. Ongoing geopolitical tensions

Trade conflicts between the US and China, Middle East tensions, and rising uncertainty around the Taiwan Strait increased demand by 7% annually.

When energy supply fears surged in July, prices jumped above $3,400. Continued uncertainty pushed prices to breach $4,300 in October.

Any new geopolitical shock in 2026 could push prices to additional record levels.

8. US dollar and real bond yields

Gold moves inversely to the dollar and real yields. In 2025, the dollar index declined by 7.64% from its peak at the start of the year until November 21.

US 10-year bond yields fell from 4.6% in Q1 to 4.07% at the end of November.

This double decline boosted institutional demand for gold, as investors sought to rebalance away from dollar-denominated assets.

Bank of America analysts see this trend continuing, with real yields stabilizing around 1.2%, potentially placing gold in a sustainable upward range.

Will Gold Really Decline in 2026?

Despite positive forecasts, risks are real:

HSBC warned that momentum could weaken in the second half of 2026, with corrections possibly bringing prices down toward $4,200 when taking profits. However, a drop below $3,800 is unlikely unless a major economic shock occurs.

Goldman Sachs cautioned that sustained prices above $4,800 would test the “price credibility” of the market, challenging gold’s ability to maintain levels amid weakening industrial demand.

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

Technical Analysis: Short-term Roadmap

On the daily chart, gold closed on November 21 at $4,065.01, after reaching a peak of $4,381.44 on October 20.

Price broke below the ascending channel line on the daily timeframe but remains above the main short- to medium-term trendline at $4,050.

Support and Resistance Levels:

• Strong support at $4,000 ###Critical Break###
• First strong resistance at $4,200
• Next resistance at $4,400 then $4,680

The RSI indicator is steady at 50, indicating neutrality, while MACD remains above zero, confirming an overall bullish trend.

Technical expectation: Continued sideways trading within a slightly upward range between $4,000 and $4,220 in the short term, with a positive outlook as long as the price stays above the main trendline.

Gold Price Outlook in the Middle East

The Middle East region has steadily increased its reserves. For example, the Central Bank of Egypt added one ton, and the Qatar Central Bank added 3 tons in Q1 2025.

In Egypt: Projections suggest the price could reach approximately 522,580 Egyptian pounds per ounce, an increase of 158.46% compared to current prices.

In Saudi Arabia: If global forecasts of ($5,000 per ounce) are realized and converted at a fixed exchange rate of (3.75-3.80 riyals per dollar), the price could be around 18,750 to 19,000 Saudi riyals.

In the UAE: Under the same scenario ($5,000), the price might be approximately 18,375 to 19,000 UAE dirhams.

Note that these projections are approximate, relying on stable exchange rates (in the region), continued global demand, and no major economic shocks.

Summary: Multiple Scenarios for Gold

Gold price forecasts in 2026 reflect a struggle between two forces: institutional and investment demand versus profit-taking and corrections.

If real yields continue to decline, the dollar remains weak, and central banks maintain their purchases, gold is likely to hit new all-time highs approaching $5,000.

Conversely, if inflation drops rapidly and market confidence returns, the metal may enter a stabilization phase, preventing reaching ambitious levels.

In reality, 2026 will be a true test of gold’s ability to defend its status as a global safe haven in a world full of change and risks.