Gold’s peaks now seem to be behind us. Here is what weighs on the growth in value of the yellow metal and what are the forecasts of the main credit institutions.
While most Western countries appear to have entered a phase characterized by rising inflation, Theytraditionally considered a safe haven from inflation, is recording its fourth consecutive month of declines.
The fall of gold
The numbers are quite clear: while American inflation recorded an increase of 4.2% on an annual basis, the highest figure since 2023, gold saw its value decrease by more than 1000 dollars from the peak marked at the beginning of 2026, now standing at 4072 dollars per ounce.
The peak was reached on January 28, 2026, when the yellow metal reached 5,303 dollars an ounce, before starting a descent that in five months would have eroded around a quarter of its value.
The attack by the United States and Israel on Iran, and the consequent closure of the Strait of Hormuz, contributed greatly to this decline, a conflict that lasted for months and which, paradoxically, ended up weighing on an asset traditionally considered a refuge in the event of war.
The closure of the Strait through which a fifth of the world’s hydrocarbons pass has caused energy prices to skyrocket, dragging inflation with it and making any monetary easing by central banks increasingly less likely.
For gold, seven of the last ten weekly closes recorded through mid-June 2026 have marked negative results, confirming a downward technical trend that shows no signs of reversing.
The opportunity cost of gold rises
The paradox of rising inflation and falling safe havens is largely explained by the dynamics of real interest rates, i.e. those adjusted for inflation. First of all, it should be remembered that gold does not pay dividends or coupons: its implicit yield is zero.
When central bank reference rates rise and government bonds offer more generous yields, the opportunity cost of holding gold (i.e. what the investor gives up by choosing the yellow metal instead of a government bond) increases significantly.
Real yields on ten-year American TIPS (Treasury Inflation-Protected Securities) stood at around 2.19% at the end of June, thus guaranteeing a yield of 2.19%. beyond to the American inflation rate. The opportunity cost is far from negligible for those who hold gold.
Not surprisingly, gold ETF funds have seen record outflows, with more than $12.7 billion leaving North America in March 2026 alone, the worst figure in five years.
Furthermore, the European Central Bank raised interest rates by 25 basis points at its June meeting, in what is the first increase since 2023, bringing the deposit rate to 2.25%.
The ECB has also revised upwards its inflation forecasts in the euro area, now expected at 3.0% in 2026 and 2.3% in 2027, making a further increase likely by the end of the year.
Here too, with real yields on European bonds rising, European capital has found fixed income to be an increasingly attractive alternative to gold.
An increase in the reference rates also seems to be increasingly probable by the US Federal Reserve, with the new president of the US central bank, Kevin Warsh, who has reiterated his commitment to fighting inflation (the target of which is 2%, against the current 4.2).
The forecasts of the main credit institutions
We then come to the forecasts on the trend of gold prices from the main credit institutions. Goldman Sachs cut its end-2026 price target from $5,400 to $4,900 an ounce on June 20, blaming the revision on outflows from gold ETFs and the removal of any U.S. rate cuts from its base case for the current year.
JP Morgan confirms itself as the most optimistic of the large banks, maintaining a target of around 6,000 dollars for the end of the year, with a possible extension up to 6,300 dollars in 2027, while admitting that investor demand has significantly diminished.
Deutsche Bank, the most conservative of the American institutions, has reduced its target for 2026, estimating an average of 4,300 dollars in the third quarter and a recovery of up to 4,800 dollars in the fourth.
We are therefore in a waiting phase. The reopening of Hormuz, the maintenance of “normal” energy prices and the slowdown of inflation could resume the “gold ride”. A resurgence of the Middle Eastern conflict, on the contrary, would have further deleterious effects on the price of the yellow metal.
