Gold Prices May Recover in H2 2026 with Favorable Market Conditions

Gold prices could see an uptick in the second half of 2026 if several conditions are met, according to UBS strategists. The metal has been struggling due to softer investment and jewelry demand, combined with higher mine supply.

The World Gold Council data shows that bar-and-coin demand fell to 307 metric tons in the second quarter from over 400 tons in each of the previous two quarters.

Investment demand excluding over-the-counter transactions declined to 262 tons from 487 tons a year earlier, reflecting outflows from gold-backed exchange-traded funds. However, central-bank purchases offered stronger support, reaching 289 tons in the second quarter and totaling about 345 tons for the first half of the year.

To remain above $4,000, investment inflows must recover, and official-sector demand needs to stay close to 300 tons per quarter, according to UBS. Monetary policy remains the main catalyst, with markets pricing possible Fed rate increases this year.