Gold Prices to Remain Volatile Amid US Data and Geopolitical Tensions

Gold prices are expected to remain volatile in the short term due to various factors such as US data, West Asia tensions, and their impact on crude prices. The ICICI Bank predicts that gold may face another turbulent period with prices potentially dropping due to a more hawkish repricing of US monetary policy amid persistent inflation concerns.

The bank's research report suggests that the medium-term outlook for gold remains supported by investment demand, continued central bank purchases, and demand for gold as a hedge against geopolitical, financial, and policy uncertainty. The ICICI Bank expects gold to trade in the USD 4,200-4,600 per ounce range for the rest of 2026 with a marginal upside bias in the first half of 2027.

The report further states that concerns over the long-term sustainability of US fiscal deficits and high public debt, continued central bank diversification away from US dollar-denominated assets, and gold's role as a portfolio hedge are likely to remain structural supports for gold prices. Geopolitical uncertainty will continue to play a role, particularly the US-Iran standoff.