Gold could reach $5,000-$5,600 per ounce and silver $95-$120 per ounce in the bull case, which is assigned a 25 per cent probability, a new report has said.
The bull case scenario assumes weakness in the labour market, forcing the Fed to ease repo rates and real yields roll over, the report from Monarch PMS said.
Further institutional reallocation into precious metals must resume and physical tightness in silver should return for the bull case to materialise.
Gold is likely to trade in the range of $4,300-$4,700per ounce and silver at $70-$85 per ounce by end-2026 in a base case, with a 55 per cent probability.
The scenario assumes the US Federal Reserve holds rates through September, energy prices normalise, real yields plateau and central banks maintain purchases of around 250 tonnes a quarter.
The bear case, with a 20 per cent probability, sees gold at $3,400-$3,900per ounce and silver at $45-$55 per ounce if the Fed delivers a rate hike in September, oil falls further, and disinflation turns into demand weakness.
“The principal headwind is the 10-year TIPS real yield, which stands at 2.41 per cent and remains a genuine competing return to a zero-coupon asset such as gold,” the report said.
“Silver’s supply-demand fundamentals also remain supportive, with a sixth consecutive annual deficit, 762 million ounces drawn from above-ground stocks since 2021 and mine supply broadly flat for a decade,” the report said.
