After a year that reshaped global perceptions of gold, the World Gold Council explores the various possibilities for the yellow metal heading into 2026.
Investors should brace for continued economic uncertainty and financial market volatility in 2026, the World Gold Council (WGC) warns in its 2026 outlook — and those circumstances could have various effects on gold.
After a blistering 2025 that has so far seen the yellow metal hit more than 50 all-time highs and rise over 60 percent, the WGC says 2026 could deliver anything from a modest rally to a steep pullback.
The year was a contest between bullish forces tied to slowing global growth and persistent political instability, and bearish pressures that could emerge if the Trump administration successfully lifts US economic performance.
For now, the WGC says the gold price “broadly reflects macroeconomic consensus expectations,” suggesting it could remain rangebound, although factors like softer growth and geopolitical turmoil are likely to provide support.
Read on for the WGC’s 2025 takeaways and its gold outlook for 2026.
2025: A year that redefined gold’s appeal
2025 is shaping up to be gold’s fourth strongest year since 1971, when the gold standard ended.
The WGC notes in its report that investment demand has accelerated across major regions, and central banks have also continued to add to reserves at levels far above historical averages.
Its long-term performance has caught even more attention. New market data shows gold has climbed 953.78 percent over the last three decades, surpassing the S&P 500’s (INDEXSP:.INX) 918.15 percent gain over the same period.
The symbolic victory is fueling renewed interest from investors who once dismissed bullion.
The case for strategic exposure has been reinforced by the metal’s resilience during market stress. Gold saw powerful rallies after the dot-com crash and again during the 2008 financial crisis. It smashed records in 2011, and now in 2025 it is trading near US$4,238 per ounce heading into the end of the year.
3 potential paths for gold in 2026
The WGC’s outlook sets out three primary macroeconomic paths that gold could follow next year: a moderate slowdown, a deep global downturn or a reflationary growth outcome tied to US policy success.
Scenario 1: A shallow slip, moderately bullish for gold
If economic momentum cools — particularly in the US labor market — without collapsing outright, investors may rotate further into defensive assets. A pullback in artificial intelligence stocks could intensify market volatility, while softer consumer activity would put more pressure on policymakers to continue loosening monetary settings.
In this environment, the WGC says gold could gain 5 to 15 percent. Lower rates and a softer dollar would help, as would ongoing central bank buying and potential new flows from large institutional investors in Asia.
Scenario 2: The “doom loop,” strongly bullish for gold
A darker outcome is also on the table: a synchronized global downturn triggered by escalating geopolitical flashpoints or trade fragmentation. As confidence falls and economies contract, the US Federal Reserve could be forced into deep rate cuts while capital floods into safe havens. The WGC estimates gold could advance 15 to 30 percent under such conditions, powered largely by strong investment demand through gold-backed exchange-traded funds.
The WGC notes that exchange-traded fund holdings have risen by more than 700 metric tons this year. Even including inflows going back to mid-2024, the total remains less than half of what was seen in earlier bull cycles.
Scenario 3: Reflation returns, bearish for gold
There is also a non-negligible possibility that US President Donald Trump’s fiscal and industrial policies could spark stronger-than-expected growth. In that case, inflation pressures could push the Fed to keep rates elevated, or even raise them again, sending the US dollar higher and dampening gold investment appeal.
In this upside-growth scenario, the WGC projects a 5 to 20 percent drop in the gold price as investors unwind hedges and rotate into stocks and higher-yielding assets.
US policy looms large over 2026
A major swing factor for gold is Trump’s expected nomination of a Fed chair who favors lower rates.
At the same time, geopolitical risks tied to US actions have been growing.
The administration’s more aggressive posture toward Venezuela and heightened tensions involving China and Russia are adding risk premiums across commodities and supply chains.
These dynamics continue to push global investors toward gold when uncertainty peaks.
The Fed’s near-term decisions will remain crucial. Markets are currently pricing a high probability of additional rate cuts, even as inflation remains a concern. Each shift in those expectations is likely to reverberate through gold pricing.
Gold market wildcards
The WGC also takes note of two supply/demand forces that sit somewhat outside typical quantitative models, but could shape outcomes significantly: official sector buying and recycling flows.
Central banks remain one of the largest gold demand pillars. Purchases have consistently exceeded pre-pandemic levels, in part because emerging market governments are diversifying away from dollar-exposed reserves.
Gold recycling is another overlooked lever. Despite soaring prices, secondary supply has been muted in 2025, partly because gold is increasingly being used as collateral. If a severe downturn forces liquidations of gold-backed debt, recycling flows could climb sharply, adding pressure to prices.
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