After a period of severe volatility in the first half of 2026, the gold market is entering a period considered the most sensitive of the cycle. According to the World Gold Council (WGC)'s mid-year outlook report, although gold prices have adjusted sharply from the peak of over 5,500 USD/ounce to below 4,000 USD/ounce by the end of June, the underlying drivers of the precious metal have not yet weakened. In that context, the WGC believes that gold is likely to accumulate in the coming months before establishing a new trend.
WGC experts believe that the current price level fairly fully reflects the global economic picture with moderate growth, inflation has cooled down but is still higher than the targets of many central banks, while monetary policy continues to be maintained in a tightening direction but not too drastic.
If these conditions do not change significantly, gold prices are likely to fluctuate in the range of about 5% around the 4,100 USD/ounce area in the second half of the year. However, the WGC also noted that the current balance may be quickly broken if new shocks from the economy or geopolitics appear.
According to this organization, three factors that could become catalysts to bring gold prices back to an upward trend include the worsening global economic outlook, expectations of interest rates reversing to a lower direction, and the return of long-term investment capital. If these factors appear simultaneously, gold prices could recover to the 4,500 USD/ounce range, even approaching the 5,000 USD/ounce mark.
In the opposite direction, the WGC also warned that gold still faces many risks in the short term. The USD continues to maintain its strength, bond yields are higher than forecast and risk-taking sentiment in the financial market may cause cash flow to continue to leave defensive assets. After the strong increase in 2025, investor profit-taking activity is also a reason why gold has become more sensitive to correction phases.
However, WGC believes that the possibility of gold prices falling deeply for a long time is not high. Historical analysis shows that every time gold falls about 10-15% from balanced zones, bottom-fishing buying power from investors and physical demand often appear, helping to limit the decline of precious metals.
One of the notable points in the report is the increasing role of central banks. Since 2022, the formal sector has bought an average of about 1,000 tons of gold per year, becoming one of the most important drivers of the market. Although some central banks have made gold sales or swap transactions in the first quarter of this year, the WGC still expects central banks to continue to be net buyers throughout 2026.
The latest survey by the WGC also shows that more and more foreign exchange reserve managers plan to increase their gold holdings in the next 12 months. According to the organization's analysis, if the amount of gold purchased by central banks is about 20-30 tons higher than the long-term average of about 600 tons per year, gold prices may be supported to increase by about 1%. This impact comes not only from actual purchase volume but also from positive signals for market sentiment.
Besides central banks, WGC believes that Asia is increasingly having a major influence on global gold price trends. Daily trading analysis shows that most of the recent recovery waves took place in Asian trading sessions, while many corrections appeared when the US market opened. This reflects the increasingly prominent role of Asian investors and consumers in the process of forming a new gold price level.
The organization also pays special attention to India - the world's second largest gold consuming market. According to the WGC, the Indian government's sharp increase in gold import taxes from 6% to 15% along with import restriction measures to protect foreign exchange reserves are likely to cause demand for jewelry gold, gold bars and gold coins to decrease by about 50–60 tons this year. However, most of the impact from this policy is said to have been reflected in the current gold price.
Closing the report, WGC said that the gold market is still standing between two opposing pulling forces. In the short term, the USD, bond yields and monetary policy continue to be factors putting pressure.
Conversely, the gold buying demand of central banks, long-term investment capital and geopolitical instability still create an important supporting foundation.
Therefore, although there is not much basis to expect an immediate strong price increase, gold is still considered one of the assets with positive prospects in the context of a volatile global economy.
