Factors driving gold prices
In a recent interview, Mr. Juan Carlos Artigas - Head of Global Research at the World Gold Council (WGC) analyzed the factors that brought gold to unprecedentedly high prices in 2025, and explained why this precious metal could continue to maintain its upward momentum next year.
He said that gold has surpassed the general market in 2025, in which two macroeconomic factors play a key role.
First is the unprecedentedly tense geopolitical and geopolitical environment; second is the widespread weakening of the USD along with a slight decrease in interest rates" - he said - "When combining these two factors with positive price increases, investment demand has become an important support for gold prices.
In addition, central banks still maintain a stable net buyer role, although the buying rate has slowed down compared to two years ago. “In addition, psychological factors and price momentum are also one of the main drivers of gold performance" - Mr. Artigas emphasized.
According to the WGC's quantitative analysis of the main drivers affecting gold prices, the results show a fairly balanced picture.
Speaking about the prospects for 2026, Mr. Artigas said that the interaction between the two macroeconomic factors mentioned above will be decisive.
The current gold price is reflecting the market's general expectations for the macroeconomy" - he explained - "That means that if the economy goes as predicted by economists and investors, gold prices may go sideways in a narrow range. However, in reality, the economy rarely operates according to the forecast scenario. Therefore, more importantly, it is to identify factors that can push gold prices up or down compared to the current level.
Regarding factors that could support gold prices, he said that US and world economic data are currently quite opposite. "If the US economy falls into a slight decline, forcing the US Federal Reserve (Fed) to cut interest rates and causing the USD to continue to weaken, this will benefit gold prices" - he said.
The upside is still very large.
Although investment demand has increased sharply in 2026, Mr. Artigas believes that the room for growth is still very large.
Since May 2024, gold ETF funds have bought about 800 tons of gold" - he said - "This number sounds large, but in reality it is still less than half compared to previous high-risk periods. If economic conditions worsen significantly, demand may increase sharply not only from gold ETFs but also from OTC markets, derivatives markets and central banks. In that scenario, gold prices may even exceed the 5,000 USD/ounce mark".
Answering questions about the possibility of gold price adjustment when investment demand decreases, Mr. Artigas did not rule out this scenario.
To some extent, the current gold price has reflected the risk compensation from current conditions" - he said - "If US economic policies bring positive effects, boosting growth – such as by resolving trade disputes or a more friendly fiscal policy – then part of this compensation will disappear and gold prices may fall from 5% to 20%, depending on the specific developments".
He also noted two other factors that could affect gold prices in 2026.
In recent years, the demand for buying gold from central banks has been very strong, not only due to macroeconomic factors but also from policy decisions" - he said - "If central banks continue to buy gold, prices will be supported. Conversely, if demand falls below the threshold of 700-600 tons, this may put downward pressure on prices.
The last risk that the WGC is concerned about is the supply of recycled gold, especially in India. "We are witnessing the situation of gold jewelry being mortgaged to borrow capital in this area" - Mr. Artigas said - "If the Indian economy weakens, a forced sell-off may occur, causing the supply to surge and thereby curbing the upward momentum of gold prices.
