HSBC has trimmed its outlook for gold prices in 2026 and 2027, with analysts pointing to a shift toward tighter U.S. monetary policy expectations and a rising dollar as the primary drivers behind the revision.
The bank now projects gold will average $4,560 per ounce in 2026, down from a prior estimate of $4,864. For 2027, the forecast was reduced to $4,925 from $5,000. HSBC also expects gold to trade in a range of $3,800 to $4,700 for the remainder of 2026, finishing the year around $4,750, while its year-end 2027 target stands at $5,025.
As of early Thursday trading, spot gold was hovering near $4,100 per ounce — more than 20% below the record high of $5,594.82 reached on January 29. That peak came as the Middle East conflict raised inflation fears and pushed the Federal Reserve toward a more hawkish monetary policy stance.
“Changing perceptions of U.S. monetary policy and the impact this had on the dollar are among the central reasons behind further gold liquidation and price declines,” HSBC stated.
The bank noted that central bank purchases of gold — which had been a key factor fueling the metal’s rise in recent years — have slowed. However, HSBC said long-term diversification strategies could still provide some support for prices going forward.
HSBC also pointed out that heavy outflows from exchange-traded funds during the first half of the year could partially reverse in the second half.
Even with the lowered forecasts, the bank suggested that significant further declines may be unlikely, as financial markets have already largely adapted to an environment of a stronger dollar and elevated interest rates.
HSBC also noted that several factors that had supported gold prices before the Middle East conflict — such as concerns over fiscal deficits, broader economic uncertainty, and growing sovereign debt burdens — remain relevant.
On the geopolitical front, the bank acknowledged the conflict still carries “the power to send gold lower, but we do not believe Iran-related declines by themselves would be long lasting,” HSBC said.
