Gold to Hit $5,000 by Q1 2026, UBS Forecasts

A potent combination of central bank buying, expanding fiscal deficits, lower U.S. interest rates, and persistent geopolitical risk is set to drive gold prices to $5,000 per ounce by the first quarter of 2026, according to a new forecast from UBS Wealth Management.

Dominic Schnider, Head of Commodities & APAC Forex CIO at the firm, stated that commodities are expected to take on a more significant role in investment portfolios in 2026. "Our forecasts point to attractive returns, supported by supply-demand imbalances, heightened geopolitical risks, and long-term trends like the global energy transition," he noted.

UBS's Detailed Gold Price Timeline for 2026

The Swiss banking giant has raised its gold price target significantly. In a recent report, strategists outlined a clear trajectory for the precious metal:

• Rally to $5,000/oz by March 2026.

• Hold at $5,000/oz through September 2026.

• Moderate to $4,800/oz by the end of 2026.

This updated end-of-year target of $4,800 is a substantial $500 increase from the bank's previous forecast of $4,300 per ounce.

UBS anticipates that demand for gold will see a steady increase throughout 2026, fueled by low real yields, ongoing global economic concerns, and domestic policy uncertainties in the United States, particularly around fiscal pressures and the midterm elections.

The Upside Case: How Gold Could Reach $5,400

The report also highlights a scenario where political or financial risks could push prices even higher. "If political or financial risks increase, the gold price could climb to $5,400 per ounce," the strategists wrote. This is an upward revision from their previous high-end estimate of $4,900 per ounce.

Geopolitical events have recently demonstrated their power to move markets. Following news that the U.S. had ousted former Venezuelan President Maduro, spot gold opened sharply higher and has continued to climb, trading as high as $4,491.20 on Tuesday.

Figure 1: A financial chart shows gold's recent price appreciation, climbing toward the $4,500 level amid market-moving events.

A Broader Bull Market for Commodities

While gold remains a key focus, UBS sees opportunities across the entire commodities complex, which is poised for attractive returns. Schnider identified several areas of interest:

• Copper and Aluminum: Both metals are projected to face supply shortages that could drive prices higher. Demand is structurally supported by the global transition to clean energy and widespread electrification.

• Crude Oil: Prices are expected to begin recovering in the second half of the year as the current surplus shrinks due to solid demand growth and moderating non-OPEC+ supply.

• Agriculture: This sector also presents specific opportunities.

Portfolio Strategy and Diversification

Schnider emphasized the value of commodities as a portfolio diversifier, particularly during periods of market stress. "Returns are generally strongest when supply-demand imbalances or macro risks—like inflation or geopolitical events—are elevated," he explained.

In favorable conditions, UBS suggests an allocation of up to 5% to a diversified commodity index to help protect against unexpected shocks.

Concluding his outlook, Schnider reiterated the firm's positive stance. "We like broad commodities exposure, gold, and select commodity-linked equities," he said, citing the compelling mix of supply-demand dynamics, geopolitical factors, and the ongoing energy transition.