"Gold prices will reach as high as $5,000 in 2026, and silver and platinum group metals will follow with catch-up gains!" Deutsche Bank significantly raises its gold price forecast for next year.

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Deutsche Bank has issued a strong bullish signal for gold in its latest report.

According to Zhuifeng Trading Desk, Deutsche Bank has significantly raised its forecast in its latest report, raising the 2026 average price target from the previous $4,000/oz to $4,450/oz, with an annual price range expected at $3,950-$4,950/oz, and a possible peak of $4,950/oz, implying that gold prices may challenge the $5,000 threshold.

Deutsche Bank pointed out that the driving force behind this structural bull market has fundamentally shifted, with rigid official buying replacing price-sensitive consumer demand. As emphasized in the report:

Price-inelastic central bank purchases and ETF investment demand are replacing price-sensitive jewelry demand, becoming the dominant force in the gold market. At the same time, overall demand growth exceeds supply growth, and this supply-demand mismatch provides a solid floor for gold prices.

Despite the solid bullish logic, Deutsche Bank also noted potential downside risks. Should the stock market undergo a deep correction or the Fed’s ease in 2026 falls short of market expectations (Deutsche Bank forecasts a 50-basis-point rate cut, lower than the market's anticipated 93 basis points), gold prices could see short-term shocks. Additionally, if the Russia-Ukraine conflict ends through negotiations, the fading of geopolitical premium may also cause temporary negative impacts.

Central Bank Rigid Demand Leads, Target Price Looks to $5,000

The report pointed out that the gold uptrend is far from over. Gold's performance in 2025 is described as an “exception among exceptions”—its outperformance over the dollar reached new highs since last year, and price volatility reached record levels since 1980. More importantly, central banks, as inelastic demand players, are consistently “taking away” supply from flexible demand sectors like jewelry, and this structural change provides solid support for gold prices.

Deutsche Bank stated:

The outperformance against the dollar is comparable to the record set in 2024, and the 2025 gold price range is the largest since 1980. Historically, since 1971, there have only been eight years in which annual gains exceeded the year's volatility range, all in price increases. Even if gold's outperformance vs. the dollar in 2026 is not as strong as in 2024–2025, prices can still extend from current strength. This structural support comes from the dominance of growth in inelastic demand.

On the demand side, even with gold prices at high levels, official gold demand in Q3 rebounded significantly from Q2, reaching 220 tons, only slightly lower than Deutsche Bank’s forecast of 239 tons. In actual USD terms, this is the third-highest level of official demand on record.

Deutsche Bank believes central banks’ ongoing purchases are seen as the ultimate hedge against “black swan tail risk,” providing strong confidence in precious metals. It expects official demand in 2026 to rebound to 1,053 tons per year, which is critical to the price forecast. If official demand falls back to the 2011–2021 average, the 2026 average gold price would drop to $3,850/oz instead of the predicted $4,450/oz.

Full-year 2025 jewelry demand is expected to be weaker than indicated by price elasticity. Although jewelry consumption rose in Q3, even accounting for a 22% seasonal increase in Q4, annual demand remains weak. Deutsche Bank expects jewelry demand may remain under pressure in 2026.

Central Bank Buying Resonates with ETFs

Meanwhile, after four years of net outflows, ETF investors returned to the market in 2025, and normalized ETF inflows suggest that “the $3,900/oz floor will remain robust.”

Deutsche Bank’s analysis states:

2025 marks the return of ETF investors to accumulation after four years of redemptions. ETF demand is also expected to align with prices after significantly underperforming expectations for two consecutive years.

In the short term, ETF gold selling has shown signs of normalization. The rapid sell-off starting on October 22, comparable in scale to the April-May phase, has since oscillated between modest net buying and selling. This brief and intense liquidation suggests the $3,900/oz support level will hold.

Structural Supply-Demand Imbalance Continues

On the supply side, global gold mine production in Q3 rose by 72 tons to a record 977 tons, but this increase was easily overtaken by the rise in official and ETF demand (up by 99 tons quarter-over-quarter).

Deutsche Bank extrapolates Q1–Q3 mine output to the full year, factoring in positive seasonal factors in Q3 and Q4, and forecasts 2025 production at 3,693 tons. This indicates supply’s response to rising prices is very muted, consistent with its long-term lagging nature.

Among these factors, the Grasberg mine disruption had a significant impact. Deutsche Bank noted that Grasberg’s Block Cave operations, shut down in September, will restart in phases in H1 2026. PT Freeport Indonesia cut forecasts in mid-November, guiding 2026 gold output at 900,000 oz, down from 1.6 million oz before the incident. The output loss at Grasberg alone can offset the commencement of two major new mines in recent years.

Silver, Platinum and Palladium Also Set to Benefit from the Rally

This extreme physical supply-demand tightness is not limited to gold. Deutsche Bank notes that consecutive years of supply shortfalls have enabled silver, platinum, and palladium to more fully participate in gold’s strong rally.

A notable detail in the report is the surge in lease rates, “Elevated lease rates indicate physical scarcity, affecting industrial users, as many prefer leasing metals rather than owning them.” Based on this, Deutsche Bank expects that silver and platinum will remain in deficit next year, and has raised the 2026 silver target to $55/oz.

Specifically:

Silver: The net balance after deducting ETF demand is now at the tightest proportion of supply on record. Deutsche Bank expects the 2026 average silver price to be $55.1/oz, with ETF silver holdings set to surpass the 2021 peak, reaching 1.116 billion troy ounces by end-2026. The supply-demand forecast assumes silver will remain in deficit in 2026.

Platinum: The World Platinum Investment Council expects a 30% increase in bar and coin demand next year. Deutsche Bank expects 2026 platinum investment demand to rebound to 500,000 oz, with a supply deficit accounting for 13% of supply, similar to the past two years.

Palladium: Three key automotive factors support palladium: catalyst makers may modestly return to palladium from platinum; the narrative of hybrids overtaking pure EVs in market share is growing; and catalyst demand for palladium remains high at 84%, so the appeal of plug-in hybrids prolongs PGM catalyst demand beyond expectations.

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The above highlights are from Zhuifeng Trading Desk.

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