Gold Prices – World Gold Council Sees Range-Bound Trade in H2 2026
Gold Prices – Gold prices may move within a limited range during the second half of 2026, although the metal could gain further if global economic conditions weaken or geopolitical tensions increase. The World Gold Council, in its Gold Mid-Year Outlook 2026 released in July, said gold is likely to remain supported by central bank purchases, inflation concerns and long-term investor demand.
Price Outlook for the Second Half of 2026
The Council expects gold to trade roughly 5 per cent above or below the US $4,100 per ounce level during the remaining months of 2026 under current economic conditions. Its analysis indicates that a renewed rise towards US $4,500 per ounce is possible if market risks intensify. A sustained move closer to US $5,000 per ounce, however, would require a stronger and more decisive trigger.
The report said gold’s next upward phase could depend on worsening global growth conditions, heightened geopolitical uncertainty, changes in interest-rate expectations and increased investment from long-term asset holders.
Economic and Geopolitical Risks Remain Key Factors
Financial market instability and geopolitical developments have historically strengthened demand for gold. The World Gold Council noted that a monthly increase of 100 points in the Geopolitical Risk Index has previously been associated with an average 2.5 per cent rise in gold prices.
Interest-rate expectations in the United States will also remain important. If markets begin to expect a more accommodative approach from the US Federal Reserve, gold may receive additional support. Lower interest-rate expectations can improve the appeal of non-yielding assets such as gold.
Inflation and Dollar Movement Under Watch
The global economy is projected to grow by 2.9 per cent in 2026, while the US economy is expected to expand by 2.1 per cent. US inflation may reach around 3.9 per cent during the second quarter before easing later in the year. Global inflation is estimated to average 4.3 per cent in 2026.
The report said prolonged inflationary pressure can support gold prices, particularly when inflation remains higher than expected for an extended period. The direction of the US dollar will also play a major role, as currency forecasts for the second half of the year remain mixed.
Central Bank Purchases Provide Structural Support
Central banks have purchased an average of around 1,000 tonnes of gold annually since 2022. According to the Council, reserve additions of 20 to 30 tonnes above the long-term annual average of about 600 tonnes could contribute approximately 1 per cent to gold price growth.
Long-term investors are also becoming more active in the market. Sovereign wealth funds, pension funds and insurance companies are gradually increasing exposure to gold. In China, a pilot initiative introduced last year allowed major insurers to invest in the metal, widening institutional participation.
India’s Demand Outlook Faces Import Duty Pressure
India remains the world’s second-largest gold market, with annual net demand estimated at about 800 tonnes. However, the report identified India as an important demand segment to monitor after the government increased import duty from 6 per cent to 15 per cent in early April.
The policy change was accompanied by consumer messaging aimed at moderating imports amid pressure on the Indian rupee. The World Gold Council estimates that the higher duty could reduce demand for jewellery, bars and coins by 50 to 60 tonnes, representing around 10 per cent year-on-year.
Downside May Be Limited by Physical Buying
Gold could face pressure if the US dollar strengthens, interest rates rise beyond market expectations or investors shift strongly toward riskier assets. Even so, the Council said a decline of 10 to 15 per cent from current levels may encourage renewed buying, helping to restrict further losses.
The report concluded that gold’s performance in the first half of 2026 reflected its close link with global economic conditions and geopolitical developments. Continued support from central banks and institutional investors may help maintain gold’s position as a strategic asset in the months ahead.