Analysts at French banking giant Societe Generale SA have raised their gold price forecast dramatically, saying it’s becoming “increasingly inevitable” that gold will hit US$5,000 per ounce by the end of 2026.
The bank had previously predicted a target of US$4,300 per ounce, but the recent surge in gold demand from central banks and exchange-traded funds (ETFs) has led to a sharp upward revision. The announcement follows gold reaching an all-time high of US$4,379.60 per ounce last week.
In their latest research note, shared via Kitco News, the analysts wrote:
“With ETF flows remaining strong and central bank buying expected to stay resilient, we feel confident and compelled to update our target prices for gold. We now see prices reaching US$5,000/oz by the end of 2026, as ETF inflows have surpassed our initial assumptions.”
The team added that there’s greater upside than downside risk to this forecast, noting that global uncertainty and shifting economic policy have intensified investor appetite for gold.
Gold’s Surge Driven by Global Uncertainty
Societe Generale attributes much of the price momentum to ongoing economic instability and geopolitical tensions, including the effects of US trade tariffs, government debt levels, and interest rate expectations.
With investors pricing in additional rate cuts by the US Federal Reserve later this year, the environment remains favourable for gold as a defensive asset.
The analysts observed that ETF flows have closely mirrored rising uncertainty since the 2024 US election, suggesting that investor demand for safety continues to strengthen.
Central Banks Powering the Bull Run
Supporting this view, Goldman Sachs reports that global central bank gold purchases have increased fivefold since 2022.
According to Goldman analyst Lina Thomas, this marks a structural shift in reserve management, as nations diversify away from the US dollar:
“Emerging market central banks remain significantly underweight gold compared to developed economies and are gradually increasing allocations as part of a broader diversification strategy.”
While developed nations such as the US, Germany, France, and Italy hold around 70% of their reserves in gold, China’s reserves remain below 10%, signalling further potential for large-scale buying.
A World Gold Council survey also revealed that 95% of central banks expect global gold reserves to rise within the next year, with 43% planning to increase their own holdings—the highest since 2018.
ETF Inflows and Investor Demand Skyrocket
Investor enthusiasm is evident in both institutional and retail markets, particularly in gold-linked ETFs and ASX-listed mining stocks.
In fact, a major ASX gold ETF was the top-performing fund last month, climbing 23%, while gold mining shares like:
Northern Star Resources (ASX: NST) reached $26.52,
Evolution Mining (ASX: EVN) climbed to $12.04,
Newmont Corporation (ASX: NEM) hit $152.72, and
Genesis Minerals (ASX: GMD) rose to $7.17.
Far East Capital, a mining investment advisory firm, described this as a “golden period of historic proportions.”
However, they also cautioned that profit-taking could occur after such rapid gains, noting that many shares could see short-term corrections before the next leg higher.
Physical Gold Demand Remains Strong
Outside financial markets, demand for physical gold has surged.
Dealers in major cities report queues of buyers looking to purchase gold bars, while others take advantage of high prices to sell their gold jewellery for profit.
At FirstGold News, we continue to monitor how these powerful trends—central bank diversification, ETF inflows, and retail demand—are converging to support what could be the most significant gold bull market in decades.
If gold maintains its position above US$4,000 per ounce, the path to US$5,000 may arrive even sooner than expected.
