Gold Price Forecast for Q4 2026: Two Opposing Forces in the Market
Gold Performance at a Glance: Gold reached $4,157 per ounce at the end of September and rose 3.7% in the third quarter. US Debt Increase: US national debt surpassing $40 trillion could intensify financial concerns and push bond yields higher. Greater Volatility Possible: Amid tensions […]
Gold performance: Gold prices reached $4,157 per ounce at the end of September and rose 3.7% in the third quarter.
Rising US debt: Passing the US national debt of $40 trillion can intensify financial concerns and raise bond yields.
The possibility of more volatility: in the conditions of extreme tension in the financial markets, investors may be forced to sell gold to provide liquidity; Even if their long-term outlook is positive.
The gold market continues to face significant obstacles, including persistent inflation, rising interest rates, and rising bond yields. However, this precious metal has shown remarkable resistance and has finished the third quarter of the year with a significant growth; That too, in a situation where the yield of American treasury bonds had reached the highest levels of the last few decades. According to one of the investment companies, these opposing forces are expected to continue to be important factors affecting the price of gold in the last three months of the year.
Market analysts at investment firm Invesco (Invesco) stated in their latest quarterly outlook report that although rising bond yields could continue to put pressure on gold prices in the fourth quarter, structural demand from central banks and the return of investor interest in gold-backed exchange-traded products (ETPs) should continue to support the price of the precious metal in the long term.
According to the report, gold ended September at $4,157 per ounce, representing a 3.7% increase in the third quarter. This positive performance came as a strong sell-off in global bond markets pushed yields on long-term US Treasuries to their highest level in more than two decades.
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Analysts noted that the yield on the 10-year US Treasury bond reached 5.28 percent at the end of September, and the yield on the 30-year bond rose to 5.63 percent; A level that has not been seen at the end of trading since 2002.
Rising bond yields, particularly real yield growth, increase the opportunity cost of holding assets such as gold that do not pay interest, analysts explain. However, they emphasized that the historical relationship between gold prices and real interest rates has weakened significantly in recent years.
According to Inosco analysts: the historical relationship between gold and real yields has weakened much from 2022 onwards; When the freezing of Russian reserves caused central banks to buy gold, regardless of the price.
stable inflation; One of the most important short-term risks of gold
Analyzing the future outlook, analysts stated that stable inflation is still one of the most important short-term risks for gold; Especially in a situation where economic growth still has considerable resistance.
According to the report, the US Federal Reserve raised interest rates by 25 basis points in September, bringing the interest rate target range to 3.75% to 4%. The updated forecasts of this central bank also indicated the possibility of at least one more interest rate increase by the end of the year.
However, Inosco said the release of weaker-than-expected personal consumption expenditure (PCE) inflation data at the end of September reduced the likelihood of an interest rate hike in October. Currently, according to the CME Group's Fedwatch tool, markets see only a 21 percent chance that interest rates will rise later this month.
The Federal Reserve is expected to keep interest rates unchanged at its October meeting to give policymakers more economic data before considering another rate hike in December.
Analysts believe that the continuation of inflation forces the Federal Reserve to maintain its contractionary approach. Inosco, meanwhile, noted that stronger economic growth is also pushing bond yields higher, posing another challenge to gold investors.
US government debt; Another factor to increase bond yields
Analysts also pointed to increased concerns about US government borrowing. The national debt of this country exceeded 40 trillion dollars in the third quarter.
According to them, with the increase in the government's financial risks, investors may demand higher returns for holding long-term debt securities; An issue that can intensify the upward pressure on bond yields.
The return of investment demand and the support of central banks for gold
Despite these challenges, Inosco believes that the fundamental factors supporting investment in gold are still in place; Especially since investors' interest in gold-backed investment products has increased again.
According to the report, the amount of global assets in physical gold-backed funds and exchange-traded products declined for a large part of 2026. The high price of gold and the strong performance of the stock market had reduced the attractiveness of this precious metal for investors in diversified investment portfolios.
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However, this trend quickly reversed in the third quarter, and global holdings of these products reached their highest level in 12 months at the end of September.
Analysts also expect the demand of central banks in the fourth quarter to continue to be one of the important sources of support for gold prices; Especially in a situation where foreign currency reserve managers pay more attention to geopolitical risks and the security of their gold assets.
Citing data from the World Gold Council, Inosco said central banks bought more gold in the second quarter of 2026 than in any second quarter on record.
Market fluctuations will continue in the fourth quarter
Despite maintaining a positive long-term outlook, Inosco warned that investors should be prepared for continued volatility in gold prices in the fourth quarter.
Analysts of this company said: If the financial markets remain unstable, we will not be surprised if the price of gold also faces more fluctuations; These fluctuations may even occur independently of the fundamental outlook for gold.
They explained that during periods of extreme stress in the financial markets, investors may be forced to sell a portion of their gold holdings to provide funds needed to cover trading account deficits or compensate for losses in other parts of their investment portfolio; Even if their long-term view of gold has not changed.
This risk is especially important for investors whose trading positions in the gold market have increased significantly in recent years.
However, INOSCO expects the diversification of central banks into foreign exchange reserves, geopolitical uncertainties and the revival of investment demand will continue to support gold; However, interest rates and high bond yields will create obstacles for this precious metal in the short term.