August 25, 2026
After several difficult months, the price of gold has regained significant momentum. The Wells Fargo Investment Institute believes the precious metal is structurally supported despite high real interest rates. The strategists expect further upside potential from current levels through the end of 2026 and project a target range of $4,900 to $5,100 per troy ounce. For 2027, the bank estimates a target of $5,400 to $5,600.
Strong demand from Asia and ETF inflows provide support
In the short term, gold is benefiting from hopes of geopolitical détente in the Middle East and waning expectations of further U.S. interest rate hikes. This already led to the strongest weekly gain (over 7 percent) since January in early August. In addition, outflows from gold ETFs have stabilized and are beginning to turn positive again.
Since the spring, the gold price had been suffering from rising inflation-adjusted U.S. yields, which make non-interest-bearing investments like gold comparatively less attractive. Nevertheless, the market has shown tremendous resilience, which, according to Wells Fargo, is driven by several strong factors:
- Strong demand from Asia: While the global spot price dipped at times during the first half of the year, performance during Asian trading hours rose by 13 percent.
- Central bank purchases: Out of concern over market risks and geopolitical uncertainties, central banks once again massively replenished their gold reserves in the second quarter.
- Portfolio diversification: In the face of persistent inflation, international investors continue to seek out safe-haven assets.
Short-term risks of setbacks, but an intact macro cycle
Sameer Samana, Head of Global Equities and Real Assets Strategy at Wells Fargo, views the recent correction primarily as a healthy reassessment of the risk-reward ratio. Investors should focus more on the long-term profile of the gold market. Since the market has already priced in further interest rate hikes by the U.S. Federal Reserve, many risks have already been factored in.
Nevertheless, the strategists urge caution in the short term: a definitive bottom has not necessarily been reached yet. There is a risk of a pullback to as low as $3,500, before technical resistance levels in the range of $4,500 to $4,900 await on the way up.
However, the long-term macroeconomic cycle clearly favors the precious metal, according to the analysts. If higher interest rates and oil prices were to stifle the economy, central banks and fiscal policymakers would ultimately have to respond again with interest rate cuts and economic stimulus programs—an ideal environment for gold. Historically, the precious metal has often proven significantly more resilient than stocks or bonds during recessions and periods of restrictive monetary policy. For Wells Fargo, gold therefore remains an indispensable component for hedging against market stress during critical market phases.
Source: https://goldinvest.de/en/gold-price-wells-fargo-sees-year-end-target-at-usd5-100
