The World Bank’s latest Commodity Market Outlook projects that gold prices may rise sharply in 2026 before facing a potential decline in 2027.
The World Bank’s latest Commodity Market Outlook report has issued projections on gold prices for the coming years. According to the report, gold prices could witness a sharp increase in 2026, followed by a potential decline in 2027. The forecast is based on global economic conditions, geopolitical tensions, and rising demand for safe-haven assets.
The report estimates that gold prices may rise by approximately 37 percent in 2026. This increase is attributed to ongoing global political and economic uncertainty. The average gold price is projected to reach around $4,700 per ounce in 2026, significantly higher than the previous year. In Indian currency terms, this corresponds to approximately ₹1.44 lakh per 10 grams.
According to the report, several factors are contributing to the rise in gold prices:
Geopolitical tensions: Ongoing international tensions, particularly instability in the Middle East and issues involving the United States and Iran, have increased uncertainty in global markets. Instability in key maritime routes such as the Strait of Hormuz affects oil and commodity supply, prompting investors to turn to gold as a safe option.
Safe-haven demand: During periods of global economic instability, investors tend to shift capital from equity markets into safer assets such as gold, increasing demand.
Speculative investment: Market speculation and short-term investment activity are also contributing to price volatility.
While 2026 is projected to be a year of b gains, the World Bank has estimated a decline of approximately 8.5 percent in gold prices in 2027. The average price is expected to fall to around $4,300 per ounce. In Indian currency, this is equivalent to approximately ₹1.31 lakh per 10 grams.
The report outlines several factors that may contribute to the decline:
Interest rate increases: If major global economies raise interest rates to control inflation, the cost of holding gold increases, potentially shifting investor preference toward other assets.
Reduction in global tensions: A decrease in international conflicts and political tensions could reduce demand for safe-haven investments, putting downward pressure on gold prices.
Strengthening US dollar: A ber US dollar may also lead to lower gold prices, as gold is priced in dollars.
Gold prices have recently shown upward momentum. In the international market, June futures on COMEX are trading at approximately $4,631 per ounce. In India, the June contract on the Multi Commodity Exchange of India is trading at around ₹1,51,000 per 10 grams.
