September 8, 2026
The price of gold is once again heading toward the psychologically significant level of $4,500 per ounce. After months of consolidation triggered by geopolitical tensions in the Middle East and renewed concerns over U.S. interest rates, Société Générale sees the current upward trend as much more than just a technical rebound. For the French investment bank, the risk-reward ratio for the precious metal has improved noticeably. The rebound signals that gold has entered a fundamentally new valuation phase despite a restrictive interest rate environment.
Market sentiment is visibly brightening: While speculative positioning has once again moved above its two-year average, the put-call ratio of the SPDR Gold Shares (GLD) fell to a six-month low—a clear indication of growing optimism among institutional investors, according to the bankers. At the same time, they note that the market has largely priced in the monetary policy headwinds. Although speculation about up to two additional interest rate hikes by the Federal Reserve pushed yields on two-year U.S. Treasury bonds above the 4% mark and supported the greenback, SocGen believes that the bulk of these expectations for restrictive interest rates is already fully priced into current prices.
Decoupling from Real Interest Rates: A New Market Regime
Central to the major bank’s investment thesis is a structural paradigm shift: Historical valuation models—which predict significant price declines for gold amid persistently high real yields—have been largely ineffective since 2022. This is because, although inflation-adjusted bond yields are at multi-year highs, gold is holding steady at a valuation level near its all-time high and remains well above the lows seen in past cycles. Since the markets have largely priced in the Fed’s potential for interest rate hikes, the analysts say, the downside risk for investors appears to be very limited.
Even in the event of persistent inflation—which could force the central bank to raise rates in the fall or winter—analysts expect a pause in rate hikes until 2027 under the base scenario. Without an extreme inflation shock, the Fed lacks the monetary policy leverage for even more aggressive tightening. The combination of mounting debt and fiscal risks places tight limits on the interest rate spiral, which permanently raises the floor for gold.
Central Banks as Structural Anchors
In addition to interest rate dynamics, real demand is proving to be a robust foundation. Although gold-backed ETFs have seen more moderate inflows this year, declining price volatility makes the precious metal particularly attractive to long-term currency and reserve managers. Emerging markets and the People’s Bank of China, in particular, are relentlessly driving the strategic de-dollarization of their currency reserves. This official sector has long since replaced speculative private investors as the dominant driver of the market.
Added to this is latent inflationary pressure, which supports gold’s ability to preserve value in the medium term: New U.S. trade tariffs, massive capital expenditures on artificial intelligence and infrastructure, and persistently high budget deficits are creating an environment in which inflation is likely to remain more stubborn than currently priced in by the bond markets. Amid these tensions, gold is demonstrating remarkable relative strength—driven by central bank purchases, de-dollarization, and the realization that even high real interest rates can no longer dampen the structural demand for this safe haven.
Source：https://goldinvest.de/en/analysts-now-might-be-the-right-time-to-get-back-into-gold
