Gold Prices Soared This Year. Will 2026 Bring More Record Highs?

Gold investors enjoyed an almost unprecedented price rally in 2025. The question now is how much the market run persists into the new year.

In a world fraught with geopolitical and economic uncertainty, gold’s safe-haven reputation thrived this year as it had not since the high-inflation era of the late 1970s and early 1980s.

The precious metal’s price has surged about 65% this year, far outpacing the performance of virtually all other risk assets, including U.S. stocks, global bonds and cryptocurrencies.

Spot gold prices hit an all-time high of around $4,560 per troy ounce last Friday before sliding more than 4% on Monday, as exchange operator CME Group raised its margin requirements for precious metals contracts and investors booked profits. Gold rebounded on Tuesday, trading recently at around $4,400.

Most analysts expect gold’s bull run to moderate somewhat in 2026. That said, most see the only way gold will fall next year is if global economic growth exceeds expectations — and it could surge in the event of a substantial global slowdown.

What Drove the 2025 Rally

A confluence of factors created the perfect storm for 2025’s rally, not the least of which centered on geopolitical turmoil. President Donald Trump’s tariffs ignited inflation concerns, and more investors parked their money in gold as a result. Events in the Middle East and the war in Ukraine contributed to global uncertainty.

Inflows into exchange-traded funds tell the story. As of November, global ETFs owning physical gold added assets for six straight months. Global gold ETFs now have a little more than a half trillion dollars in assets, with inflows on track for their strongest year ever.

The depreciating U.S. dollar also steered more investors to gold, particularly central banks. The dollar has fallen about 10% this year versus a basket of global currencies, and more central banks are turning to gold rather than the dollar to house their reserves.

Meanwhile, the Federal Reserve’s decision to lower interest rates made gold more attractive versus assets that produce a regular yield. Those cuts came in an environment in which concerns about global debt increased and the U.S. government shut down for more than a month.

What Lies Ahead

Most analysts see the price of gold settling between $4,000 and $5,000 per troy ounce in 2026, with caveats.

For instance, Goldman Sachs has a price target of $4,900. But the firm sees “significant upside” potential to that target if investors shift more of their traditional equity and bond exposure to gold ETFs.

State Street has a target of $4,000-$4,500 but says that “strategic reallocations and geopolitical factors could create a tailwind for gold to reach $5,000 per ounce.”

The World Gold Council has four different scenarios, only one of which calls for declining gold prices. That’s if economic growth triggers inflation, forcing the Fed to raise interest rates, and the dollar rises.

Conversely, the group sees a material slowdown in global growth pushing gold prices up another 15-30%. Otherwise, it foresees prices staying steady to up 15%.

As for the Fed, most analysts view the impending appointment of a new Fed chair as positive for gold. That’s because Trump plans to appoint a chair more amenable to lowering interest rates.

Strong demand likely will persist from central banks, meanwhile. A World Gold Council survey shows 95% of central banks expect to increase their gold reserves in the coming year.

Finally, physical demand for gold bars and jewelry could support higher prices. Demand in Asia and India has remained strong despite higher prices, State Street said.

“Strong pockets of physical demand that are non-cyclical (central banks) and idiosyncratic (China demand) add to gold price support and dampen downside risks,” State Street said in a research report.