The global gold price will remain rangebound around US$4,100 per ounce in the second half of 2026 under current conditions, according to the World Gold Council’s (WGC) mid-year outlook report.
The projection follows a period of high price volatility for the yellow metal. Spot gold reached an intraday record high of US$5,589.38 per ounce in January 2026 before declining to a low of US$3,959.33 per ounce in late June.
The correction left the metal down approximately 7 percent year-to-date, though it remains among the top-performing assets over the past 12 months.
The WGC stated that current pricing aligns with a baseline macro consensus consisting of 2.9 percent global economic growth, cooling but elevated inflation, and limited central bank tightening. Financial markets currently price in an interest rate hike by the US Federal Reserve by October.
“At current levels, gold’s price is broadly in line with a global backdrop of moderate growth, cooling but still elevated inflation, and expectations of further – but limited – central bank tightening,” the report stated. Under these conditions, the price is expected to fluctuate within a 5 percent range.
Separate catalysts were identified behind potential price movements. For instance, an acceleration in inflation, a shift toward lower interest rates, or a renewed geopolitical shock could move prices back toward US$4,500 per ounce.
Conversely, an environment of resilient growth and calmer markets could cause prices to decline by 10 to 15 percent, where historical data indicates bargain-hunting demand typically limits further losses.
Technically, a breach below US$3,860 per ounce could trigger a deeper downward movement.
First-half volatility and session divergence
The stability of gold’s 7 percent year-to-date decline masks a volatile first half of the year, which saw the metal hit 12 all-time highs.
Driven by elevated options activity and safe-haven positioning at the onset of the US-Iran conflict, spot gold bypassed US$5,500 per ounce intraday in late January before retrenching toward US$4,000 per ounce in late June.
An econometric breakdown via the Council’s Gold Return Attribution Model reveals that short-term momentum, investor trend-following, and late-stage profit-taking were the primary engines of price variability. Macroeconomic risk and geopolitical uncertainty contributed 16 percent to price variability, while foreign exchange volatility accounted for 15 percent as markets repeatedly adjusted to alternating patches of dollar strength and weakness.
Economic expansion and underlying interest rate expectations accounted for 11 percent and 3 percent of the metal’s price variability, respectively.
Intraday transaction data further shows a distinct geographical split in price discovery between Western and Asian market participants.
The bulk of gold’s positive price performance occurred during Asian trading hours, which yielded a 12.97 percent return and served as the market’s primary engine of price support. Conversely, the liquidation and price pullbacks were heavily concentrated during US trading hours, which logged a 15.08 percent decline, while European sessions remained relatively flat with a negative 1.32 percent return.
According to the report, this divergence only solidifies the expanding role that Asian consumers and institutional investors occupy in setting the global price trajectory.
Institutions forecast revisions
Major financial institutions have also recently revised their forecasts, which have lowered near-term price targets due to changing interest rate expectations.
Earlier this month, Goldman Sachs (NYSE:GS) reduced its 2026 year-end gold price target from US$5,400 to US$4,900 per ounce, citing lower anticipated inflows into gold exchange-traded funds because the Federal Reserve is expected to keep interest rates steady.
Deutsche Bank (NYSE:DB) also lowered its fourth-quarter projection to US$4,800 per ounce from a previous estimate of US$6,000.
Overall, market analysts note that long-term fundamental drivers remain distinct from monetary policy shifts.
“Bottom line, in my view, what causes gold to turn around is when the Fed has to stop pretending that it cares about inflation, that it can do a darn thing about it, and just starts going nuts,” Chris Temple, editor of the National Investor, told the Investing News Network. “That’s when gold gets going again, and we’re a little ways from that.”
Central bank, Indian demand drives gold dynamics
The report further identified central bank demand and regulatory changes in India as key variables for the remainder of the year.
Central banks have purchased an average of 1,000 tons of gold per year since 2022. Econometric modeling indicates that a 20-to-25-ton change in official purchases above the long-term baseline of 600 tons per year correlates to a 1 percent move in the gold price.
In India, the world’s second-largest consumer market, the government raised import duties from 6 percent to 15 percent in April to manage its current account deficit and protect foreign exchange reserves.
The Council estimates the tariff increase will reduce Indian jewelry, bar, and coin demand by 50 to 60 tons, a 10 percent year-over-year decline in domestic consumption.
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Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.
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