JPMorgan Cuts Gold Price Outlook

JPMorgan has lowered its average gold price forecast for 2026, citing weaker investor demand, slowing market activity and reduced participation across key trading indicators, although the bank maintained a bullish longer-term outlook for the precious metal.

In a research note released on Sunday, the investment bank revised its 2026 average gold price forecast downward to $5,243 per ounce from an earlier projection of $5,708 per ounce.

The bank attributed the downgrade to softer near-term demand conditions and declining investor interest in gold markets amid rising global bond yields, inflation concerns and expectations that major central banks may keep interest rates elevated for longer.

“This quietness shows through in stagnant activity and demand metrics,” JPMorgan analysts stated in the report.

The bank noted that trading activity across major gold markets had weakened significantly in recent months, with futures positioning, trading volumes and exchange-traded fund inflows all remaining subdued.

According to the analysts, “COMEX aggregate gold futures open interest and volume have remained depressed, net Managed Money futures open interest has stagnated at low levels and ETF flows have been light.”

Despite the downgrade, JPMorgan said it still expects gold prices to recover strongly later in 2026 as inflation uncertainty eases and demand from investors and central banks strengthens again.

“We retain our bullish medium-term outlook and forecast that after the immense energy and inflation uncertainty clears, gold demand from investors and central banks will again re-intensify over 2H26,” the bank said.

JPMorgan added that it expects gold prices to approach $6,000 per ounce by the end of 2026 as global economic conditions stabilise and safe-haven demand improves.

The latest revision follows a similar move by ANZ, which also lowered its year-end gold target on Friday, citing pressure from rising inflation expectations, elevated bond yields and a stronger U.S. dollar.

ANZ revised its year-end gold forecast to $5,600 per ounce and pushed its expectation for gold to reach $6,000 per ounce to mid-2027 from an earlier projection of early 2027.

Spot gold prices have declined about 14 per cent since the outbreak of the U.S.-Iran conflict in late February, with investors increasingly worried that higher oil prices could fuel inflation and delay expected interest rate cuts by the U.S. Federal Reserve.

Gold prices earlier on Monday fell to their lowest level since March 30 as a global selloff in bond markets intensified amid mounting inflation fears linked to rising energy costs and geopolitical tensions in the Middle East.

Analysts said the recent rise in bond yields has reduced the attractiveness of non-yielding assets such as gold, prompting some investors to shift toward fixed-income securities.

Data from major global economies have also reinforced concerns about persistent inflationary pressures.

Recent inflation reports from the United States, China, Germany and Japan showed price pressures remaining stronger than expected, fuelling market speculation that central banks may maintain tighter monetary policies for longer periods.

Several global financial institutions have issued differing outlooks for gold prices in 2026, reflecting uncertainty over inflation trends, interest rates and geopolitical risks.

UBS recently raised its gold target to $6,200 for March, June and September 2026, while Deutsche Bank projected average gold prices of $5,500 in 2026 with potential upside toward $6,000.

Societe Generale also projected gold prices could reach $6,000 by the end of 2026, while Goldman Sachs forecast prices of about $5,400 by December 2026.

Wells Fargo Investment Institute maintained one of the most bullish forecasts, projecting gold prices between $6,100 and $6,300 by the end of 2026.

Morgan Stanley projected average prices of $4,600, although the bank said a bullish scenario could push prices toward $5,700 during the second half of 2026.

HSBC maintained a more conservative outlook, forecasting average gold prices of $4,587 with prices expected to settle around $4,450 by the end of 2026.