Bank of America raises gold price outlook to $5,000 per ounce

Bank of America Predicts Gold Prices to Reach $5,000 by 2026

On Monday, Bank of America updated its forecast for gold prices, projecting they could climb to $5,000 an ounce by 2026 as investors increasingly turn to safe-haven assets.

This optimistic outlook comes on the heels of a turbulent year for precious metals, which recently surpassed $4,000 for the first time.

Gold reached a record high of $4,079.62 on Monday, following President Trump’s claims that China has become “very hostile” regarding rare earth regulations, alongside threats of “significant increases” in tariffs.

The surge in gold purchases is largely due to worries over escalating trade tensions. Investors often view gold as a safeguard against inflation and economic instability, given its historical ability to maintain value amid declining asset prices.

Bank of America anticipates further price increases in 2026, though they caution about the possibility of a short-term price correction.

“If investment demand increases by 14% akin to this year, gold prices could hit $5,000 an ounce by 2026,” the bank noted.

Factors contributing to this year’s significant gold rally include concerns about Trump’s tariffs potentially spurring inflation, persistently high interest rates, a weak U.S. dollar, the threat of a government shutdown, and a sluggish labor market.

This year, gold has risen around 50%, marking its best performance since 1979.

Wheaton Precious Metals’ CEO, Randy Smallwood, emphasized that gold prices could easily reach $5,000 within a year and possibly double by the end of the decade. “I truly believe we will see gold cross that $5,000 threshold within a year,” he remarked on Bloomberg TV. “It’s a path that could take us to $10,000 an ounce by decade’s end, which wouldn’t shock me at all.”

Wheaton, which provides upfront loans to miners in exchange for discounted metals, has profited from the soaring prices this year as geopolitical tensions and supply issues drive more investors toward gold.

In tandem, major stock indexes have also set new record highs, following this year’s upward trends.

The Dow Jones Industrial Average was up 582 points, or 1.3%, on Monday as President Trump attempted to ease investor worries over the weekend.

“Don’t stress about China; everything will be alright! President Xi Jinping just had a tough moment,” Trump posted on his platform Truth Social on Sunday. “The U.S. is here to assist China, not to hinder it!!!”

Additionally, Goldman Sachs recently raised its December 2026 gold price forecast from $4,300 to $4,900, citing expected central bank purchases, estimating an average of 80 tonnes in 2025 and 70 tonnes in 2026 as these banks diversify their reserves.

Deutsche Bank analysts also predict that gold prices may surpass $4,000 by year-end.

Last month, the Federal Reserve initiated a quarter-percentage-point cut in interest rates, the first since December 2024. Another reduction is anticipated at an upcoming meeting this month, according to CME FedWatch, which monitors 30-day federal funds futures prices.