Due to weaker investor demand and minimal trading activity in the bullion market, JPMorgan Chase has reduced its average gold price projection for 2026 from USD 5,708 to USD 5,243 per ounce.
In a note dated Sunday, bank analysts stated that “investor client interest has ‘dried to a trickle,'” noting that COMEX gold futures activity, managed money positions, and ETF inflows continued to be muted.
According to the bank, trade volumes and aggregate open interest in gold futures have remained low in recent months, indicating a decline in institutional investor participation.
JP Morgan kept its positive outlook on gold and its year-end objective of about USD 6,000 per ounce despite the reduction in its average prediction.
The bank stated that once the concern around energy prices and inflation starts to decrease, it anticipates a strengthening of investor and central bank demand in the second half of 2026.
The analysts stated, “We maintain our bullish medium-term outlook and forecast that gold demand from investors and central banks will again re-intensify over 2H26 after the immense energy and inflation uncertainty clears.”
The updated prediction coincides with pressure on metal prices from growing US Treasury yields, a stronger dollar, and persisting inflation worries related to the current US-Iranian confrontation.
Since the battle began in late February, spot gold prices have decreased by almost 14% due to rising oil prices, which raise the possibility that the US Federal Reserve would keep interest rates high for an extended period of time.
Gold fell to its lowest level since March 30 earlier this week as a result of a wider selloff in international financial markets brought on by concerns about inflation.
In addition, ANZ reduced its year-end gold price prediction to USD 5,600 on Friday, citing rising rates, anticipated inflation, and sustained dollar strength.
According to JP Morgan’s updated prediction, the bank continues to project a quicker rebound in the second half of 2026 but anticipates poorer pricing performance in the first half.
