Deutsche Bank Sees Gold Prices Hitting $8K in 5 Years; World Bank Expects Prices to Average $4,700 in 2026

Deutsche Bank recently said in a recent research note to clients that gold prices are positioned to benefit from a fragmented world as central banks prioritise gold holdings over the US dollar as their go-to reserve asset.

The German brokerage expects central banks, particularly emerging economies, to continue ramping up their gold holdings as a financial hedge against Western sanctions. Deutsche Bank had estimated that these central banks have added more than 225 million ounces of gold to their reserves since the 2008 global financial crash, while their USD holdings declined in tandem from a peak of 60% in the early 2000s to around 40% at present.

Analysts pointed out that gold purchases are extending beyond Russia, India, and China to nations like Egypt, United Arab Emirates, Qatar, and even Kazakhstan. The current trend implies that gold's share in central bank reserves could increase to 40% from 30% at present.

In case this becomes a reality, Deutsche Bank believes the gold price could reach $8,000 per ounce within the next five years, which would be an 80% jump from current levels. This forecast aligns with the trending view that gold is poised to benefit from the de-dollarisation trade as trust in US assets continue to falter. Note that economic and geopolitical turmoil are among the top factors driving central banks to bump gold holdings.

Gold Prices In 2026 To Hover Around $4,700

World Bank commodity analysts believe gold price could be range-bound through 2026. Gold prices ended Q1 with 17% gains while silver prices soared 55% compared to a quarter earlier.

The momentum of precious metals has slumped in recent months amid rising energy prices and inflation fears amid the Middle East war. However, the World Bank expects gold prices to record another year of robust growth.

Now, the analyst expects gold prices to average at $4,700 per ounce in 2026 but expects prices to drop 7% in 2027, with a similar path for silver, averaging $70 per ounce this year.

'Given the sensitivity of precious metals prices to shifts in global risk sentiment, speculative demand, and macroeconomic conditions, the outlook remains subject to considerable uncertainty. On balance, risks to the baseline forecast remain tilted to the upside. A resurgence of global trade tensions or financial market volatility could trigger additional safe-haven inflows into gold and silver, pushing prices above current projections,' the analysts said.

The World Bank believes the biggest headwind to gold prices remains higher inflation amid fast-rising prices of energy and other commodities.

'This would tend to increase the opportunity cost of holding precious metals, which are non-interest-bearing assets. A sustained easing of geopolitical tensions could also soften safe-haven flows, while a sharper slowdown in central bank purchases—after several years of exceptionally strong accumulation—could remove another important source of price support,' the analysts said.

Overall, the World Bank thinks downside surprises could be significant, especially in case of a reversal of the speculative surge in demand since early 2025 through profit-taking and portfolio rebalancing.

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