Gold Bull Run May Stay Intact As JPMorgan Projects Price Crossing $5,000 An Ounce In 2026
Gold continued its upward trend with the metal rising over 1% on Thursday. JP Morgan expects the bull run to stay intact with the price to reach an average $5,055 per ounce by the end of the fourth quarter of 2026.
Rising Investor Demand and Central Bank Buying
The forecast is based on the back of rising investors demand and central bank buying that is expected to average at nearly 566 tons of the metal in a quarter of 2026. Gold investment remains a popular choice among Indian investors, and this forecast can have significant implications for those looking to diversify their portfolios.
“Gold remains our highest conviction long for the year, and we see further upside as the market enters a Fed rate-cutting cycle,” Natasha Kaneva, Head of Global Commodities Strategy at JP Morgan, said in a note accessed by Reuters.
US Federal Reserve Cutting Cycle and Stagflation Anxiety
According to another analyst Gregory Shearer, Head of Base and Precious Metals Strategy, JP Morgan, the combination of US Federal Reserve cutting the cycle “with overlays of stagflation anxiety”, concerns surrounding Fed independence and the broader debasement hedging is helping the gold’s upward move.
For Indian investors looking to invest in gold, it’s essential to understand the factors driving the price increase. The US Federal Reserve’s monetary policy decisions can have a significant impact on the global economy and, subsequently, on gold prices.
Dollar Diversification and Foreign Holders
The bank also noted that the rally is not a de-dollarisation or a debasement story. According to the analysts, it is a story of dollar diversification, highlighting that the foreign holders are slowly moving towards gold through small allocations.
This trend can be beneficial for Indian investors who are looking to diversify their portfolios and reduce their dependence on the US dollar. By investing in gold, investors can hedge against potential risks and take advantage of the rising demand for the metal.
Market Consolidation and Long-Term Target
JPMorgan also highlighted that recent market consolidation in healthy as the pullback reflects the market digesting the fast gain in price since August. Explaining the steep rise Kaneva said that the story is simple, there are lots of buyers, however, there are no sellers.
She also reiterated that the long-term target is of $6,000 per ounce by 2028. She further stressed that gold should be viewed on a multi-year horizon.
For Indian investors, it’s essential to have a long-term perspective when investing in gold. The metal’s price can be volatile in the short term, but its value tends to appreciate over time, making it a attractive investment option for those looking to build wealth.
Spot Gold and Annual Performance
Spot gold in this year alone has hit multiple record highs with the latest high being on Monday at $4,381.21. This indicates a 57% rise year-to-date and it also shows that the stage is set for its strongest annual performance since 1979.
Indian investors who are looking to buy gold can consider this trend as a positive sign. The rising demand for gold and the limited supply can drive the price higher, making it an attractive investment option for those looking to capitalize on the trend.