Bank of America expects gold to average $4,000 an ounce in the fourth quarter, then recover to an average of $4,813 in 2027. The bank says weak physical demand and a hawkish Fed will keep pressure on prices until inflation and Iran war worries ease.
At a glance
- BofA says buying by central banks, China and India has slowed in aggregate.
- It warns ETF holders could sell if prices keep falling.
- A dovish Fed or renewed fears about the dollar's value could restart gold's uptrend.
Background
Banks publish gold forecasts that move with the market. These are Bank of America's calls, not certainties. Gold has been under pressure in recent weeks as higher energy prices pushed up inflation worries, bond yields and the dollar.
What happened
Bank of America said on Monday it expects gold to average $4,000 an ounce in the fourth quarter and $4,813 an ounce in 2027, Reuters reported. Near-term headwinds will persist until risks from rising oil prices linked to the Iran war ease, the bank said.
"We remain cautious near-term as the macro environment remains challenging," its analysts wrote in a note quoted by Kitco News. Spot gold was at $4,172.39 an ounce at 1412 GMT, down 0.5% on the day, Reuters reported.
Why the bank is cautious
BofA said gold-backed ETFs have drawn money in recent months, but that this could turn into a risk if falling prices prompt investors to sell. It said physical markets remain soft, citing feedback from last week's London Bullion Market Association conference.
"Our tracker suggests that other key market participants, including central banks, China and India, have, in aggregate, slowed gold buying," the analysts said. They added that central banks could resume sales as the Middle East conflict escalates.
What would change the view
The bank said gold will likely bottom out only once inflation and Iran war worries subside, the dollar stops rising and the Fed ends its tightening cycle. Renewed fears about the dollar losing value, for example if US debt were financed in ways that kept short-term rates low, would be "a very bullish scenario for gold", it said.
Our read
Outlook: bearish. Bank of America expects gold to stay under pressure in the fourth quarter before recovering in 2027.
What to watch
- US inflation data and the Fed's next rate decision.
- Oil prices and the Iran war.
- Gold ETF flows and central bank buying.
For information only, not investment advice.
Gold price in India
metalscost.com India reference price as of 2026-11-01.
Detailed analysis
Timeline
- 2026-10-12: Bank of America forecasts a $4,000 average for the fourth quarter.
Interest Rates
A hawkish Fed and rising rates have weighed on gold.
Central Banks
BofA says central bank buying has slowed and could turn to sales.
Currency Impact
A rising dollar is one of the pressures BofA cites.
What could lift prices
- BofA expects gold to average $4,813 in 2027.
- ETF inflows have stayed positive in recent months.
What could weigh on prices
- Physical demand remains weak.
- Central banks could resume selling, BofA says.
Country impact
| Country | Impact | Reason |
|---|---|---|
| United States | High | Fed policy and the dollar are the main drivers in the bank's view. |
| India | Medium | BofA says Indian gold buying has slowed. |
| China | Medium | BofA says Chinese buying has slowed. |
Industry impact
| Industry | Effect | Reason |
|---|---|---|
| Gold Mining | Negative | A lower near-term price outlook squeezes miners' margins. |
Other ways this could play out
- If the Fed stops raising rates and the dollar weakens, gold could recover faster than BofA expects.
- If ETF holders start selling, prices could fall below $4,000.
Price risks
- Forecasts change with the market and are not guarantees.
- An escalation in the Middle East could move gold sharply either way.
Technical view
Price is trading below both its 20-period and 50-period moving averages, a bearish alignment.
Computed from metalscost.com's own stored price history.
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