Gold is breaking historical norms. Outperformance versus the US Dollar (USD) matches a record set last year, and the 2025 range in Gold is the largest since 1980. Stabilising investor flow and technical measures indicate a positioning correction has completed, Deutsche Bank's Research Analyst Michael Hsueh report.

Central bank demand keeps Gold strong

"Third quarter supply-demand data supports a continued central bank bid. The positive structural picture shows inelastic demand from central banks and ETF investment diverting supply from the jewellery market. Also, overall growth in demand outpaces supply. These factors argue for an upgrade to our 2026 forecast towards $4,450/oz from $4,000/oz previously, and a yearly range from $3,950-4,950/oz in 2026. A high of $4,950/oz would be a premium of 14% over current Dec'26 GC futures."

"Consecutive years of undersupply enables Silver, Platinum, and Palladium to participate more fully in Gold's strength. Elevated lease rates indicate physical scarcity which affects industrial users, many of whom prefer to lease than own. We expect supply-demand to remain in deficit for Silver and Platinum next year, while Palladium is balanced."

"Gold often exhibits a positive correlation to risk, so a deeper equity market correction would be damaging, as would our House view for less Fed easing than the market expects in 2026 (-50 bps vs -93 bps). A negotiated end to the Russia-Ukraine conflict would be a temporary negative. In the bigger picture, reserve managers could slow their pace of buying, and dramatic increases in real Gold prices are often followed by significant corrections."