Gold is breaking historical norms. The outperformance against the US dollar (USD) matches last year’s record, and the 2025 range in gold is the largest since the 1980s. According to a report by Deutsche Bank research analyst Michael Huh, steady investor flows and technical measures indicate that the situation recovery is complete.
Gold remains strong due to central bank demand
“Q3 supply-demand data continues to support central bank bids. The positive structural picture shows inelastic demand from central banks and ETF investments removing supply from the jewelry market. At the same time, the overall growth in demand outpaced supply. These factors lead to an upgrade of our 2026 forecast to $4,000/oz from $4,450/oz previously and $4,450/oz in 2026. “Arguments for an annualized range of $3,950-4,950/oz would be a premium of 14% over current Dec’26 GC futures.”
“Consecutive years of low supply have enabled silver, platinum and palladium to fully participate in gold’s strength. Increased lease rates indicate a physical shortage that impacts industrial users, many of whom prefer to lease rather than own. We expect silver and platinum to be in a supply-demand deficit next year, while palladium is balanced.”
“Gold often exhibits a positive correlation with risk, so a deep correction in the equity markets would be detrimental, as would our House view of a lower Fed easing in 2026 than the market expects (-50 bps vs. -93 bps). A negotiated end to the Russia-Ukraine conflict would be a temporary negative. In the bigger picture, reserve managers could slow the pace of their purchases, and dramatic increases in real gold prices are often followed by significant corrections.”
