Gold price seen hitting record $4,920 as bull run resumes

Gold prices are expected to surge to a record annual average of S$4,920 an ounce in 2026 as investor demand strengthens and geopolitical uncertainty continues to bolster the metal’s safe-haven appeal, according to Metals Focus.

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 jewellery 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 jewellery 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 US 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 jewellery. 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 US 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.

Jewellery 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 jewellery 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.

Bull case

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 suggests investors are increasingly viewing gold as protection against inflation, geopolitical instability and concerns about long-term economic growth. As demand patterns evolve and physical investment overtakes jewellery consumption, the market appears to be entering a new phase in which investment flows play a larger role in determining prices.