UBS Raises Its Mid-year 2026 Gold Prices Forecast

UBS has raised its mid-year 2026 gold price forecast, arguing that the drivers behind this year's surge remain firmly in place as the market heads into another period of heavy investor and central-bank demand.

Gold has held above $4,000 an ounce after a steep climb in 2025 that left it as the year's strongest major asset. UBS strategists said the consolidation has not altered their outlook and now see the metal reaching $4,500 an ounce by June 2026, up from the previous $4,200 call.

"The gold price has stabilized above USD 4,000/oz after a phenomenal run in 2025," strategists led by Wayne Gordon wrote, and despite the pause, they forecast "even higher prices in 2026," prompting their forecast hike.

The strategists point to a combination of further Federal Reserve rate cuts, lower real yields, geopolitical tensions, and rising fiscal concerns in the U.S., all of which they believe should sustain demand from both financial investors and reserve managers.

They also flag increased political noise ahead of the midterm elections as another support for safe-haven buying.

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UBS maintains an Attractive stance on gold and continues to recommend long exposure in its asset allocation. The strategists believe gold "remains an effective portfolio hedge (even at current levels)."

A key part of the bank's bullishness is a rebound in exchange-traded fund (ETF) inflows next year, supported by easier monetary conditions.

UBS forecasts around 750 metric tons of ETF buying in 2026, which would still be more than double the average annual pace seen in the decade after 2010.

The bank also expects persistent central-bank and sovereign wealth demand, projecting purchases of 900 metric tons next year, a moderation from 2025 but far above long-term norms.

"Material underreporting (versus monthly IMF reported purchases) and recent anecdotal conversations with reserve managers signal to us a strong appetite for adding to existingreserves in 2026," strategists noted.

UBS has also raised its upside case to $4,900 an ounce, citing a potential spike in political and financial risks. The bank expects some consolidation around $4,300 an ounce after U.S. political events in late 2026, but sees the overall demand profile as strong.

Source: Investing