Institutions have raised their average gold price forecasts for this year and next, while maintaining a long-term bullish outlook.
2026-03-25 11:03:40
Despite the ongoing turmoil in the Middle East, gold prices have failed to demonstrate the strength expected of a traditional safe-haven asset, leading to escalating investor disappointment. However, despite persistent short-term selling pressure, many major international banks have not adjusted their long-term optimistic forecasts for gold and silver.
On Tuesday (March 24), the Bank of Montreal (BMO) released its latest commodity price forecast report. Despite multiple headwinds, the Canadian bank maintains a long-term bullish stance on gold and silver.
BMO commodity analysts warned that the economic environment has changed due to the war between the US and Israel and Iran, and gold and silver prices may continue to be under downward pressure in the short term. However, they emphasized that the bullish momentum in the market has only temporarily stalled, rather than a trend reversal.
Analysts stated, "The conflict in Iran has not weakened the structural bullish logic in the metals and mining sectors; on the contrary, it has further strengthened it. The only question now is when the market will regain sufficient confidence that the conflict is being resolved, thereby increasing its risk exposure again."
In its latest price forecast, BMO significantly raised its expectations for gold. The bank now expects the average gold price to reach $4,800 per ounce in the third quarter of 2026, a 7% increase from its previous forecast; the average price in the fourth quarter is projected to rise further to $4,900 per ounce, a 9% increase from its previous forecast.
For the full year, BMO expects the average gold price in 2026 to be $4,846 per ounce , a significant upward revision from its previous forecast of $4,550 per ounce.
Looking further ahead, BMO remains extremely bullish on gold. The bank expects gold prices to remain stable above $5,000 per ounce until 2027, with an average annual price of $5,125 per ounce , a significant upward revision of 26% from its previous forecast.
BMO is also optimistic about silver, but warns that its volatility will be significantly higher than that of gold. The bank expects the average silver price to reach $70.60 per ounce in the third quarter of 2026, a significant upward revision of 28% from its previous forecast; the average price in the fourth quarter is expected to be $68.10 per ounce, an upward revision of 31% from its previous forecast.
For the full year, BMO expects the average silver price in 2026 to be $74.50 per ounce , a 32% increase from its previous forecast. However, the bank believes that 2026 may be the peak for silver prices, with the average price expected to fall back to $64.20 per ounce in 2027, still a significant 42% increase from its previous forecast.
Regarding short-term price movements, BMO analysts point out that gold and silver will be easily affected by changes in speculative sentiment among retail investors.
They stated, "We believe that retail investors account for at least 60% of the inflows into gold ETFs. Therefore, changes in retail investor psychology, with momentum trading playing a significant role, will have a major impact on gold prices in the coming months, especially following the outbreak of the conflict in Iran. Historically, gold has typically performed better in the initial weeks following a major conflict, but its performance has been relatively weak in this conflict. However, this time is significantly different, most importantly because gold prices have risen significantly over the past two years due to substantial inflows of speculative and strategic funds."
Analysts further emphasized: " We believe the long-term bullish logic for gold remains intact, including structural factors such as asset diversification, currency devaluation, and de-dollarization . However, we may need to wait for the conflict to be resolved before sellers turn into buyers again."
While the long-term trend for silver prices remains positive, BMO analysts are more cautious about the short-term outlook . They point out that the Middle East conflict is suppressing global economic activity, significantly dragging down industrial demand for silver.
The bank expects the physical silver market to return to a state of oversupply, which could alleviate the recent liquidity-driven price increases.
Analysts concluded: "While the overall logic for hard assets remains strong in 2026, we believe that other precious metals will be difficult to replace gold's position, and we expect the discount of silver relative to gold to continue to widen this year."
Currently, the ongoing uncertainty stemming from the Middle East conflict, along with the complex and evolving global economic outlook, is putting short-term pressure on gold and silver prices. Rising investor disappointment has led some speculative funds to take profits or shift towards more liquid assets such as the US dollar, resulting in a significant pullback in gold prices.
However, major international banks such as BMO have not changed their long-term structurally bullish view on precious metals. They believe that the current gold price correction is more of a "pause" than a "reversal," and that once there are signs of easing tensions and global risk sentiment stabilizes, gold's appeal as a core safe-haven asset and a diversified asset allocation tool will quickly return.
For investors, patience is key. On the one hand, they should be wary of short-term volatility risks, especially the selling pressure that may arise from changes in retail investor sentiment; on the other hand, they should recognize that the long-term bull market foundation for gold and silver, including central bank gold purchases, geopolitical risks, and monetary system adjustments, remains solid.
Against this backdrop, BMO's significant upward revision of its forecast provides an important reference for the market: although gold prices may continue to be under pressure in the short term, in the medium to long term, gold is expected to return to above $5,000, while silver, although more volatile, still has significant upside potential.
The key variables for future market trends will remain the progress of the Middle East conflict, the monetary policy orientation of major central banks around the world, and the speed at which investor risk appetite recovers.
Spot gold daily chart source: EasyForex
At 10:40 AM Beijing time on March 25, spot gold was trading at $4583.15 per ounce.
On Tuesday (March 24), the Bank of Montreal (BMO) released its latest commodity price forecast report. Despite multiple headwinds, the Canadian bank maintains a long-term bullish stance on gold and silver.
BMO commodity analysts warned that the economic environment has changed due to the war between the US and Israel and Iran, and gold and silver prices may continue to be under downward pressure in the short term. However, they emphasized that the bullish momentum in the market has only temporarily stalled, rather than a trend reversal.
Analysts stated, "The conflict in Iran has not weakened the structural bullish logic in the metals and mining sectors; on the contrary, it has further strengthened it. The only question now is when the market will regain sufficient confidence that the conflict is being resolved, thereby increasing its risk exposure again."
BMO has significantly raised its gold price forecast, with the average price expected to exceed $5,100 by 2027.
In its latest price forecast, BMO significantly raised its expectations for gold. The bank now expects the average gold price to reach $4,800 per ounce in the third quarter of 2026, a 7% increase from its previous forecast; the average price in the fourth quarter is projected to rise further to $4,900 per ounce, a 9% increase from its previous forecast.
For the full year, BMO expects the average gold price in 2026 to be $4,846 per ounce , a significant upward revision from its previous forecast of $4,550 per ounce.
Looking further ahead, BMO remains extremely bullish on gold. The bank expects gold prices to remain stable above $5,000 per ounce until 2027, with an average annual price of $5,125 per ounce , a significant upward revision of 26% from its previous forecast.
Silver is also bullish, but higher volatility is expected.
BMO is also optimistic about silver, but warns that its volatility will be significantly higher than that of gold. The bank expects the average silver price to reach $70.60 per ounce in the third quarter of 2026, a significant upward revision of 28% from its previous forecast; the average price in the fourth quarter is expected to be $68.10 per ounce, an upward revision of 31% from its previous forecast.
For the full year, BMO expects the average silver price in 2026 to be $74.50 per ounce , a 32% increase from its previous forecast. However, the bank believes that 2026 may be the peak for silver prices, with the average price expected to fall back to $64.20 per ounce in 2027, still a significant 42% increase from its previous forecast.
Short-term prices are facing shocks from retail investor sentiment.
Regarding short-term price movements, BMO analysts point out that gold and silver will be easily affected by changes in speculative sentiment among retail investors.
They stated, "We believe that retail investors account for at least 60% of the inflows into gold ETFs. Therefore, changes in retail investor psychology, with momentum trading playing a significant role, will have a major impact on gold prices in the coming months, especially following the outbreak of the conflict in Iran. Historically, gold has typically performed better in the initial weeks following a major conflict, but its performance has been relatively weak in this conflict. However, this time is significantly different, most importantly because gold prices have risen significantly over the past two years due to substantial inflows of speculative and strategic funds."
Analysts further emphasized: " We believe the long-term bullish logic for gold remains intact, including structural factors such as asset diversification, currency devaluation, and de-dollarization . However, we may need to wait for the conflict to be resolved before sellers turn into buyers again."
Silver faces pressure from industrial demand, and BMO remains relatively cautious.
While the long-term trend for silver prices remains positive, BMO analysts are more cautious about the short-term outlook . They point out that the Middle East conflict is suppressing global economic activity, significantly dragging down industrial demand for silver.
The bank expects the physical silver market to return to a state of oversupply, which could alleviate the recent liquidity-driven price increases.
Analysts concluded: "While the overall logic for hard assets remains strong in 2026, we believe that other precious metals will be difficult to replace gold's position, and we expect the discount of silver relative to gold to continue to widen this year."
Overall Outlook: Short-term pressure does not change the long-term bullish logic
Currently, the ongoing uncertainty stemming from the Middle East conflict, along with the complex and evolving global economic outlook, is putting short-term pressure on gold and silver prices. Rising investor disappointment has led some speculative funds to take profits or shift towards more liquid assets such as the US dollar, resulting in a significant pullback in gold prices.
However, major international banks such as BMO have not changed their long-term structurally bullish view on precious metals. They believe that the current gold price correction is more of a "pause" than a "reversal," and that once there are signs of easing tensions and global risk sentiment stabilizes, gold's appeal as a core safe-haven asset and a diversified asset allocation tool will quickly return.
For investors, patience is key. On the one hand, they should be wary of short-term volatility risks, especially the selling pressure that may arise from changes in retail investor sentiment; on the other hand, they should recognize that the long-term bull market foundation for gold and silver, including central bank gold purchases, geopolitical risks, and monetary system adjustments, remains solid.
Against this backdrop, BMO's significant upward revision of its forecast provides an important reference for the market: although gold prices may continue to be under pressure in the short term, in the medium to long term, gold is expected to return to above $5,000, while silver, although more volatile, still has significant upside potential.
The key variables for future market trends will remain the progress of the Middle East conflict, the monetary policy orientation of major central banks around the world, and the speed at which investor risk appetite recovers.
Spot gold daily chart source: EasyForex
At 10:40 AM Beijing time on March 25, spot gold was trading at $4583.15 per ounce.
- Risk Warning and Disclaimer
- The market involves risk, and trading may not be suitable for all investors. This article is for reference only and does not constitute personal investment advice, nor does it take into account certain users’ specific investment objectives, financial situation, or other needs. Any investment decisions made based on this information are at your own risk.
