On Monday, October 13, amid escalating tensions in the US-China trade relations and expectations of a rate cut in the US, the price of gold exceeded $4,100 per ounce for the first time, reaching a new historic high. At the same time, silver prices also hit a record high. The global research department of Bank of America predicts that gold prices will surpass $5,000 per ounce next year in 2026.
Recent fluctuations in the prices of gold and silver indicate high volatility in the short term. On October 8, gold prices broke through $4,000 per ounce for the first time. Last week, after the Chinese Communist Party tightened rare earth exports globally, US President Trump warned of imposing 100% tariffs on China, leading investors to increase their safe haven bets. Additionally, expectations of a rate cut in the US have enhanced the attractiveness of gold.
On Monday, the spot gold price rose by 2.21% to $4,106.05 per ounce, hitting a historic high of $4,116.77 at one point. US December gold futures settlement price rose by 3.3% to $4,133.
Driven by the same factors supporting the tense gold and spot markets, the spot silver price rose by 3.58% on Monday to $52.08, reaching a historic high of $52.12 intraday.
Technical indicators show that both gold and silver are in overbought territory, with gold’s Relative Strength Index (RSI) at 80 and silver at 83.
Platinum rose by 3.42% to $1,641.45, and palladium increased by 5.2% to $1,478.66.
Bank of America believes there is a risk of a pullback in gold prices in the near term but still expects further upward movement in gold prices in 2026. The bank stated, “Looking ahead to 2026, if investment demand grows by 14% – similar to this year – gold prices could rise to $5,000 per ounce.”
CNBC reported that Philip Strobebel, the chief market strategist at Blue Line Futures, said, “Gold is likely to maintain its pace of growth. We could see gold rise to $5,000 by the end of 2026.”
Gold prices have surged by nearly 50% so far this year. According to Fortune, if this pace is maintained, gold could potentially rise by 150% as early as 2028.
In a report released on Monday, market veteran and Yardeni Research President Ed Yardeni reaffirmed his bullish outlook on gold, having seen gold prices reach his expectations ahead of time several times.
He cited gold’s traditional role as an inflation hedge, global central banks’ de-dollarization after Russia’s asset freezes, the bursting of China’s real estate bubble, and trade wars as supporting factors.
Yardeni added, “Our current target is for gold to reach $5,000 by 2026. If gold continues its current trajectory, we could see gold reach $10,000 by 2030.”
Based on the trend in gold prices since the end of 2023, gold could reach a milestone of $10,000 per ounce between mid-2028 and early 2029.
The recent rate cut by the Federal Reserve last month also lifted gold prices as policymakers shift more attention to the stagnant labor market rather than fighting inflation.
While the Fed has not hinted at starting an aggressive easing cycle, the prospect of further rate cuts has heightened inflation concerns amid strong GDP growth.
Simultaneously, the soaring debt levels in major advanced economies, including the US, have raised concerns among investors about global currencies. This has fueled so-called “debasement trades,” betting on precious metals and Bitcoin, as countries are expected to let inflation worsen to alleviate debt burdens.
Hamad Hussain, an economist specializing in climate and commodities at Capital Economics, stated in a report last Wednesday that the “fear of missing out” sentiment had spread to gold trading, making it more difficult to objectively assess the value of gold. He expects gold prices to continue to rise, but with key bullish factors weakening, the pace of increase may slow down.