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Economic Slowdown Could Trigger Surge in Gold Prices
(MENAFN) The World Gold Council warned Thursday that deteriorating global economic conditions or escalating geopolitical strife could ignite a fresh rally in gold valuations.
"Gold has experienced a remarkable 2025, achieving over 50 all-time highs and returning over 60%. This performance has been supported by a combination of heightened geopolitical and economic uncertainty, a weaker US dollar, and positive price momentum," the council stated in its Gold Outlook 2026 report.
The organization indicated that institutional investors and sovereign monetary authorities have expanded their gold holdings in pursuit of portfolio diversification and financial security.
2026 Price Trajectory
The assessment noted that current gold valuations largely mirror prevailing macroeconomic projections and may trade within established boundaries if present circumstances hold steady.
"However, taking cues from this year, 2026 will likely continue to surprise," the council emphasized.
Should economic expansion decelerate and borrowing costs drop further, gold could register "moderate" appreciation, the report highlighted, while adding that under a more "severe" contraction characterized by mounting worldwide hazards, the precious metal could deliver robust returns.
Supplementary drivers including central bank purchasing activity and gold recycling patterns will also shape market dynamics. Crucially, amid sustained market turbulence, gold's function as a portfolio hedge and anchor of financial stability remains paramount.
"Gold has experienced a remarkable 2025, achieving over 50 all-time highs and returning over 60%. This performance has been supported by a combination of heightened geopolitical and economic uncertainty, a weaker US dollar, and positive price momentum," the council stated in its Gold Outlook 2026 report.
The organization indicated that institutional investors and sovereign monetary authorities have expanded their gold holdings in pursuit of portfolio diversification and financial security.
2026 Price Trajectory
The assessment noted that current gold valuations largely mirror prevailing macroeconomic projections and may trade within established boundaries if present circumstances hold steady.
"However, taking cues from this year, 2026 will likely continue to surprise," the council emphasized.
Should economic expansion decelerate and borrowing costs drop further, gold could register "moderate" appreciation, the report highlighted, while adding that under a more "severe" contraction characterized by mounting worldwide hazards, the precious metal could deliver robust returns.
Supplementary drivers including central bank purchasing activity and gold recycling patterns will also shape market dynamics. Crucially, amid sustained market turbulence, gold's function as a portfolio hedge and anchor of financial stability remains paramount.
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