Gold bull run to extend into 2026, silver to stay supported: Report

New Delhi [India], January 2 : Gold will continue to shine, prices are expected to make new highs in 2026, driven by central bank buying, Fed rate cuts, a weaker dollar, concerns about the Fed's independence, and ETF buying, noted ING's Commodities Outlook 2026.

"Central banks are still buying, Trump's trade war is ongoing, geopolitical risks remain elevated, and ETF holdings continue to expand while expectations of more Fed rate cuts intensify, suggesting this bull run still has further to go. We see prices averaging $4,325/oz in 2026," the report noted.

According to the outlook, President Trump's pick for Fed chair is expected to push for lower interest rates, benefiting gold. Central banks too continue to be a key driver of gold demand, with many institutions adding to their gold reserves in recent months. In the third quarter of 2025, central banks bought an estimated 220 tonnes of gold, a 28% increase from the second quarter.

Poland, China, and Kazakhstan have been among the most active buyers, with Poland's central bank resuming purchases after a five-month pause

"Central banks' appetite for gold is driven by concerns from countries about Russian-style sanctions on their foreign assets in the wake of decisions made by the US and Europe to freeze Russian assets, as well as shifting strategies on currency reserves.", the report further said.

Investment demand for gold has also been a powerful force, with gold-backed exchange-traded funds (ETFs) seeing significant inflows in recent months. "Gold ETF investors added 222 tonnes, taking global holdings within reach of their November 2020 all-time high.", the report added.

Silver, often nicknamed "gold on steroids", made new highs in 2025, due to "persistent supply deficit, strong industrial demand thanks to solar - one of the metal's primary uses, EVs and electronics, and renewed investment flows into silver as a cheaper alternative to gold."

On the supply side, silver is facing another year of deficits, extending the multi-year trend of tightening physical balances. This year will mark the fifth consecutive year of deficits.

"We expect silver prices to remain well-supported amid the combination of resilient industrial demand, constrained supply growth, and a more favourable macro environment. We see prices averaging $55/oz in 2026", the report stated.

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