Institutions remain vigilant about raising their gold price forecasts, as the precious metal continues to benefit from persistent U.S. macro risks, central bank demand, and inflows from exchange-traded funds.

UBS on Monday raised its end-March 2026 gold price forecast by $100 to $3,600 per ounce, citing sticky inflation, weak U.S. growth prospects, and dollar softness. According to CNBC, the bank also increased its end-June 2026 forecast by $200 to $3,700 per ounce, introducing a new end-September 2026 target at the same level.

“We see U.S. macro-related risks, questions over Fed independence, worries about fiscal sustainability, and geopolitics underpinning de-dollarization trends and more central bank buying. In our view, these factors will drive gold prices even higher,” UBS said in a note.

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The bank expects ETF demand to reach nearly 600 metric tons in 2025, the strongest inflows since 2010, and forecasts total gold demand will rise 3% to 4,760 tons, the highest level since 2011. UBS projects central bank purchases will remain strong, though somewhat below last year's near-record levels.

Although central bank purchases amounted to 415 tons in the first half (down 21% year-over-year), the demand is still healthy. Reuters reported that July marked China's ninth straight month of reserve additions, lifting its holdings to nearly 74 million ounces.

“Continued purchases by one of the world’s largest central banks signal strong underlying demand for gold,” said MarketPulse analyst Zain Vawda.

The precious metal commodity market is driving opportunities in its numerous moving parts. Trafigura Group, one of the world's largest commodity traders, has hired a team of seasoned gold and silver traders from MKS Pamp SA and OCIM to expand into doré markets.

The new desk will initially handle semi-processed bars but could eventually compete with global banks in the refined bullion trade, people familiar with the matter said to Bloomberg. The trading landscape is shaping up to be competitive. Trafigura is looking to challenge large global banks, while itself fending off competition such as Vitol Group, Mercuria Energy, and Gunvor Group.

Despite the institutional optimism, a recent gold price action has shown signs of a slowdown. After touching $3,500 per ounce in April, the price tried reaching that level multiple times and failed. Each time, the Relative Strength Index indicator showed weakening momentum.

Spot gold price year-to-date | Source: TradingView

Yet, this situation doesn’t deter large capital, which typically moves with years or even decades in mind, and dismisses the short-term fluctuations as mere volatility.

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