Deutsche Bank "expects gold price of $4,000 per ounce next year"

Outlook for increase amid central bank demand, dollar weakness, and easing rates

"Risk of stagnation if equity markets remain strong or rates rebound"

Deutsche Bank raised its forecast for next year's gold price by $300 to $4,000 per troy ounce.

According to Reuters on the 17th (local time), Deutsche Bank raised its price forecast, citing demand from central banks, potential dollar weakness, and a resumption of the Federal Reserve's easing cycle as reasons it expects gold to strengthen.

Deutsche Bank had also raised its forecast in April to $3,700 per ounce on the assumption of three rate cuts by the Fed this year.

The bank pointed out that recent changes in the composition of the Federal Open Market Committee (FOMC) and ongoing concerns about the independence of the Federal Reserve will act as upward factors for gold prices.

The bank added that official gold demand has continued at twice the 2011–2021 average pace, largely driven by China. It said that recycled gold supply this year remained 4% below expected levels, which also helped spur price increases.

However, the bank noted that, based on recent 10- and 20-year historical trends, the fourth quarter is seasonally weak for gold prices.

It also warned of risks such as reduced investment incentives due to the recent strength of equity markets and the possibility that a rebound in U.S. inflation in 2026 could lead the U.S. to keep rates on hold.

While progress in U.S. trade talks could reduce uncertainty around corporate investment, it explained that gold's sensitivity to such events is limited.

Non-yielding gold bullion, considered a safe-haven asset in uncertain times, tends to perform well in a low-interest-rate environment. Gold bullion is up about 40% year-to-date and hit an all-time high of $3,702.95 the previous day.

Deutsche Bank also raised its silver price forecast for next year, increasing the average from $40 to $45.

Kim Jeong-a, guest reporter kja@hankyung.com