The bullish camp for gold is growing! RBC: Heading towards the "5,000 mark" by year-end, driven by three major tailwinds

Source: Cailian Press

Christopher Louney, head of Global Commodities Strategy and Middle East and North Africa Research at RBC Capital Markets, stated that the recent price trends of gold indicate that geopolitical instability, global de-dollarization, and concerns over US dollar depreciation have once again become the focus. Gold price is now poised to move toward the "5000 mark."

In his latest commodity analysis report, Louney wrote: "We have remained steady this year, sticking to the forecast released in December last year for solid reasons. We emphasize that although the fundamental drivers for gold price increases may temporarily stall, they still exist."

"Despite a more than one quarter decline in exchange-traded products (ETP) holdings, we believe that asset allocation driven by the return of uncertainty, de-dollarization, and concerns over depreciation is still expected, and these capital flows will return and push gold prices higher—this view is supported by the rebound in gold in early August, current pricing, and the inflow patterns." he added.

Louney further pointed out, "We still believe that for the remainder of this year, gold prices will fluctuate most of the time within the range of $4,500–$5,000 per ounce (this view remains unchanged and confident), and we now particularly emphasize our mid-to-high expectation range for gold prices in Q3 and Q4 (as well as the whole year)."

In RBC's gold outlook report for 2026 released last December, Louney stated that the path of least resistance for gold this year remains upward.

"In an environment full of uncertainty, gold has proven its value over the past year. Unless uncertainty disappears entirely, we believe the path of least resistance for gold is to hold steady or rise," he wrote at the time.

In the aforementioned latest report, Louney pointed out, "If there is any key takeaway from 2025 to apply to 2026, it is that although uncertainty may manifest in various forms, ongoing uncertainty over tariffs, geopolitics, conflict, political situations, government shutdowns, and legislation makes investors feel under-allocated in gold. Considering gold's strong price performance and low correlation, we believe it is now easier to accept it as a strategic component of an investment portfolio."

"Aside from the purchase volume itself, the narrative of continued large-scale gold buying by central banks has also driven a broader permit structure for investors to allocate gold." Louney wrote.

Coincidentally, Goldman Sachs Research also stated that, as central banks seek to diversify their foreign exchange reserves, demand for gold remains robust,

"We continuously see central banks increasing their gold reserves—a multi-year trend as central banks diversify their reserves to hedge geopolitical and financial risks, consistent with recent survey evidence," the bank's report said, and expects that by 2026, central banks will purchase an average of 50 tons of gold monthly, up from the pre-2022 average of 17 tons per month."

Editor: Zhu Henan