OCBC Group Research has revised its gold price forecast sharply higher, raising its end-2026 target to US$5,600 per ounce from a previous estimate of US$4,800, citing the metal’s recent surge to record highs and the growing role of gold as a strategic portfolio asset.
In a Precious Metals Focus report, OCBC said the upward revision reflects the strength and persistence of the latest rally rather than a fundamental change in the underlying investment narrative. Gold prices have climbed above US$5,000 per ounce, marking the strongest year-to-date rally since 2000, with pullbacks proving shallow and well supported despite intermittent easing in headline geopolitical risks.
According to OCBC FX Strategist Christopher Wong, recent price behaviour suggests gold is increasingly being treated as a strategic allocation rather than a purely tactical hedge. “What has evolved is the degree of allocation rather than the rationale for holding gold,” the report noted, pointing to rising government debt burdens, heightened geopolitical uncertainty and policy unpredictability as key drivers behind a structural re-rating of gold’s role in investor portfolios.
OCBC said gold is no longer viewed solely as a crisis or inflation hedge, but increasingly as a neutral and reliable store of value that provides diversification across a wider range of macroeconomic regimes. This shift helps explain why price corrections have tended to be limited and short-lived.
The research house highlighted that the core supports for gold remain intact. Geopolitical uncertainty continues to act as a structural, rather than episodic, source of support, even as individual flashpoints de-escalate. Recent developments involving Venezuela, Greenland and renewed unpredictability in US policy have reinforced broader themes of global fragmentation, sanctions risk and policy volatility.
OCBC also observed that gold prices now appear to embed a persistent geopolitical or uncertainty premium that cannot be fully explained by traditional drivers such as real yields, the US dollar, exchange-traded fund (ETF) flows or volatility. This premium reflects lingering concerns over geopolitical risks, policy unpredictability and confidence in the US dollar.
Monetary conditions remain another key pillar underpinning gold prices. While market expectations around the pace and scale of US Federal Reserve easing have fluctuated, OCBC noted that the overall policy bias remains tilted toward accommodation. Even when rate cut expectations are pushed back, yields have struggled to rise meaningfully on a sustained basis, limiting the opportunity cost of holding gold.
Official sector demand continues to provide a strong anchor for the market. Central banks have remained consistent buyers of gold as part of long-term reserve diversification strategies, rather than reacting to short-term price movements. OCBC said recent data point to robust official purchases, reinforcing gold’s status as a core reserve asset alongside traditional currencies.
In addition, known gold ETF holdings have surged to more than 100 million ounces, or over 4,000 tonnes, as at Jan 23, 2026. This steady demand base has helped dampen downside volatility and allowed the market to absorb profit-taking without a material breakdown in the broader uptrend.
Against this backdrop, OCBC said the recent rally warrants a recalibration of price forecasts rather than a reassessment of gold’s medium-term outlook. However, it cautioned that higher price levels could make gold more sensitive to near-term macro repricing, particularly movements in real yields and the US dollar, potentially leading to greater two-way volatility.
Looking ahead, OCBC identified key signposts to watch, including the trajectory of real yields, the evolution of Federal Reserve guidance, any slowdown in central bank buying and shifts in geopolitical risk premia. A sustained rise in real yields could temper further upside, while renewed policy uncertainty or clearer confirmation of Fed easing would likely reinforce support for gold price
