Gold on pace for largest yearly loss in 11 years; Iran war lifts yields, dollar

The survey's findings point to knock-on effects from the Iran war, not haven buying, as the main force behind the gold outlook. Oil's advance has translated into higher yields, a stronger dollar and bets on rates staying high, which raises the cost of holding the metal. Crude is therefore a crucial upstream factor for bullion: should oil and yields soften, for instance on progress in US-Iran talks, one of the main headwinds analysts flag would be removed. Silver has additional downside because its industrial uses make it vulnerable to softer solar demand as well as rate pressure. The projected gap between the two metals tilts in gold's favour.

---

Earlier:

• UBS argues three demand pillars limit gold's downside and set a floor near $4,000

---

The Iran war has inverted gold's normal crisis response, with oil-driven yields and a firm dollar inflicting the damage, though analysts expect central banks to cushion the decline.

Summary:

• The median 2026 gold forecast in a Reuters poll of 30 analysts and traders came in at $4,495 an ounce, down from $4,509 three months ago
• The 2027 gold forecast climbed to about $4,650 from about $4,610
• Gold has dropped from a January record near $5,600 to roughly $4,000, on track for its biggest yearly decline in 11 years
• High yields, a strong dollar and higher-for-longer rate expectations tied to the Iran war are the main burdens
• Central bank purchases and physical demand from India and China are expected to offer support
• Silver is forecast to average around $70 in 2026 and $67 in 2027, versus near $53 now, with weak solar demand a drag

For a second straight quarter, analysts marked down their 2026 gold price view, pointing to high US Treasury yields, a sturdy dollar and the likelihood that interest rates stay elevated for longer; they still anticipate a recovery in 2027, the Reuters survey found.

Conducted over three weeks, the poll gathered 30 analysts and traders and produced a median 2026 forecast of $4,495 an ounce, trimmed from $4,509 in the prior poll three months earlier. The 2027 median moved up to about $4,650 from about $4,610.

The downgrade follows a sharp reversal during the year. Gold reached a high near $5,600 an ounce in January before sliding to about $4,000. The Iran war drove up oil prices and Treasury yields and strengthened the dollar, all of which undermined bullion, a non-interest-bearing asset. The metal is now poised for its steepest annual fall in 11 years.

Still, analysts see supports forming. Standard Chartered expects prices to stabilise and then climb in the coming months as attention shifts to de-dollarisation and currency debasement. Survey respondents also cited strong central bank buying and healthy physical demand. One analyst said steadier physical buying in India and China should underpin prices if no unexpected shock occurs. The same analyst added that continued central bank purchases signal how official institutions manage risk, and that signal outweighs the amount of gold they buy.

The silver outlook is softer. Analysts project an average near $70 an ounce this year and $67 in 2027, which would still exceed the current price of roughly $53. As both a precious and an industrial metal, silver is more exposed than gold to rates staying higher for longer. Respondents noted weaker demand from solar, substitution in manufacturing and cautious sentiment after this year's sharp swings, including a record high around $122 in January. With solar oversupplied and sentiment toward AI under pressure, silver is expected to lag gold, and heavy ETF outflows this year have left the market in surplus.

Whether yields and the dollar ease from present levels now largely determines the path for both metals.