Central bank demand and Fed uncertainty drive revision
Deutsche Bank has increased its gold price forecast for 2026 by $300, setting a new average target of $4,000 per ounce. The German bank cited strong central bank purchases, potential weakness in the U.S. dollar, and the likelihood of a resumed interest rate-cutting cycle by the Federal Reserve as key factors behind the bullish outlook.
This update comes ahead of the Fed’s policy announcement and follows the bank’s earlier projection of $3,700 per ounce made in April. Deutsche Bank warned that changes in the composition of the Federal Open Market Committee and political pressure from U.S. President Donald Trump could create additional uncertainty, further supporting gold’s appeal.
Demand from China and limited supply support prices
According to the report, official sector gold demand remains twice as strong as the 2011–2021 average, driven largely by China. Meanwhile, recycled gold supply is running 4% below expectations, reducing downward pressure on prices and creating room for continued gains.
Despite these bullish factors, the bank cautioned against potential headwinds. These include seasonal price weakness in the fourth quarter, robust equity market performance, and a stronger-than-expected U.S. economy that may lead the Fed to pause further rate cuts in 2026.
Silver outlook also revised upward
Alongside its gold forecast, Deutsche Bank also raised its 2026 silver price target to $45 per ounce, up from $40. Gold, a non-yielding asset often favored in uncertain economic conditions, has surged nearly 40% year-to-date and hit a record high of $3,702.95 on Tuesday.
While improved U.S. trade negotiations could reduce economic uncertainty, Deutsche Bank noted that gold’s sensitivity to such developments remains limited. The commodity continues to benefit most from monetary policy shifts and safe-haven demand.
