Bank of America on Monday hiked its price forecast for gold to $5,000 an ounce in 2026 as investors flock to the safe-haven asset.
The bullish prediction follows a blowout year for the precious metal, which surged above $4,000 for the first time ever last week.
Gold notched a new all-time high of $4,079.62 on Monday after President Trump threatened a “massive increase” of tariffs on China, accusing the nation of “becoming very hostile” in its rare earth restrictions.
Fearful of heightened trade tensions, investors rushed to buy gold, which is seen as a hedge against inflation and uncertainty due to its capacity to hold value while other assets fall.
While Bank of America warned of a possible near-term correction, it still expects a further upswing in 2026.
“Looking into 2026, a 14% increase of investment demand – similar to what we have seen this year – could lift gold to $5,000/oz,” the bank said.
Anxiety around Trump’s tariffs and their potential to cause inflation, stubbornly high interest rates, a weaker US dollar, the government shutdown and a slow labor market have all contributed to gold’s explosive rise this year.
The value of gold has spiked about 50% so far in 2025, marking its best year since 1979.
Randy Smallwood, chief executive of Wheaton Precious Metals Corp., said Friday that gold could easily climb to $5,000 an ounce within a year – and double that by the end of the decade.
“I’m confident that we will see gold over $5,000 within the next year,” he told Bloomberg Television. “It’s a trajectory that could easily put it up to $10,000 an ounce before the end of the decade. It wouldn’t surprise me at all.”
Wheaton, which provides upfront financing to miners in exchange for discounted metals, has benefitted from a surge in prices this year as geopolitical uncertainty and a limited physical supply push investors toward gold.
Major stock indexes have also notched record-high after record-high this year.
The Dow Jones Industrial Average jumped 582 points, or 1.3%, on Monday as Trump tried to ease investor concerns over the weekend.
“Don’t worry about China, it will all be fine! Highly respected President Xi just had a bad moment,” Trump said in a post Sunday on his Truth Social platform. “The USA wants to help China, not hurt it!!!”
Meanwhile, Goldman Sachs last week hiked its December 2026 gold price forecast to $4,900, up from $4,300.
It cited likely central bank buying, which it expects to average 80 metric tons in 2025 and 70 tons in 2026 as banks diversify their reserves.
Deutsche Bank analysts have also projected that gold prices could rise above $4,000 by the end of the year.
The Federal Reserve cut interest rates last month for the first time since December 2024 by a quarter point. It’s widely expected to issue another cut at its meeting later this month, according to CME FedWatch, which tracks 30-Day Fed Funds futures prices.
A lower interest rate typically leads to lower Treasury yields. That makes gold, which doesn’t pay interest, an even more attractive asset.
