Gold could hit record $4,920 as bull run resumes

Gold prices are expected to surge to a record annual average of $4,920 an oz. in 2026 as investor demand strengthens and geopolitical uncertainty continues to bolster the metal’s safe-haven appeal, according to Metals Focus. The yellow metal sat at $4,472.90 per oz. on Thursday morning. 

The London-based precious metals consultancy said in its newly released Gold Focus 2026 report that total gold supply is forecast to rise 3.1% this year, driven by modest gains in mine production and recycling. Total demand is expected to slip 2.3%, reflecting weaker jewelry consumption and lower central bank purchases, although those declines are set to be largely offset by stronger bar and coin buying. Physical investment is forecast to surpass jewelry as the largest component of gold demand for the first time.

“Gold rallied strongly in 2025, by 44%, its best performance since 1980,” Matthew Piggott, director of gold and silver at Metals Focus, said. “The drivers from 2025 remain intact: ongoing U.S. policy uncertainty, persistent concerns about the dollar’s long-term outlook, elevated geopolitical risks and stretched equity valuations. Together, these factors reinforce gold’s role as a safe haven and portfolio diversifier.”

The forecast highlights a continuing shift in global gold markets as investors increasingly favour bullion over jewelry. Metals Focus expects mine output to rise 2.4% to 3,907 tonnes this year after reaching a record 3,817 tonnes in 2025. 

Supply growth

Recycling is projected to climb 5.1% despite limited near-market stocks and investors’ reluctance to part with holdings amid economic uncertainty.

Physical investment rose 16% in 2025 to a 12-year high, supported by tariff concerns, rising U.S. debt levels, questions about Federal Reserve independence and ongoing geopolitical tensions. Exchange-traded products recorded inflows of 803 tonnes, their strongest annual gain since 2020.

Jewelry demand moved in the opposite direction. Global fabrication fell 19% last year to a five-year low of 1,646 tonnes as record prices encouraged consumers to buy lighter pieces, shift to lower carat products and substitute platinum or gold-plated alternatives. Metals Focus expects jewelry demand to fall another 11% in 2026.

Central banks remained significant buyers despite a slowdown. Net official sector purchases declined 22% in 2025 to 848 tonnes, a four-year low, although Metals Focus noted buying remained well above levels seen before 2022 as countries continued to diversify reserves away from traditional holdings.

Price outlook

The consultancy acknowledged recent pressure on gold prices from shifting interest-rate expectations and the conflict involving Iran. However, it expects those headwinds to prove temporary.

“In spite of these headwinds, we are confident that, once the Iran war dust settles, gold will resume its bull run,” the report stated. “Crucially, all other factors that underpinned gold last year are likely to remain in place over the rest of 2026 and beyond.”

The outlook points to the potential for investors to view gold as a hedge against inflation, geopolitical instability and concerns about long-term economic growth. As demand patterns evolve and physical investment overtakes jewelry consumption, the market appears to be entering a new phase in which investment flows play a larger role in determining prices.

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