- By Kamakshi Bishnoi
- Sun, 22 Feb 2026 08:32 PM (IST)
- Source:JND
Gold prices could scale fresh record highs in 2026, driven by rising geopolitical tensions, record central bank purchases and expectations of US interest rate cuts, according to a new forecast by global brokerage firm UBS.
UBS has projected that gold could climb to USD 6,200 per ounce by mid-2026. In Indian currency terms, this translates to approximately Rs 1,98,484 per 10 grams. However, the firm expects some consolidation later in the year, with prices potentially easing to around USD 5,900 per ounce by end-2026.
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The brokerage estimates that central banks could purchase about 863 metric tonnes of gold in 2025, with buying likely to increase to 950 tonnes in 2026. Gold exchange-traded funds (ETFs) are also expected to witness inflows of up to 825 tonnes.
Data from the World Gold Council shows that global gold demand crossed 5,000 metric tonnes for the first time in 2025. Rising incomes and sustained jewellery demand across Asia are expected to provide long-term support to prices.
On the supply side, production growth remains limited. Research firm Wood Mackenzie estimates that nearly 80 mines will reach their current production plans by 2028, indicating constrained output expansion.
Gold has also benefited from escalating tensions between the United States and Iran. Oil prices surged to their highest levels since July, with Brent crude rising above USD 72 per barrel before easing to around USD 71.5, nearly 4 per cent higher for the week.
In times of geopolitical uncertainty, investors typically turn to gold as a safe-haven asset. The metal is currently trading near USD 5,035 per ounce, up about 0.8 per cent amid recent tensions.
UBS expects the US Federal Reserve to continue its rate-cut cycle, with two 25-basis-point reductions anticipated by September. A weaker dollar and declining real yields are generally seen as supportive for gold prices.
With strong demand, limited supply growth, potential monetary easing and heightened geopolitical risks, analysts believe the yellow metal could witness a significant rally in 2026.