Gold Price Forecast: What Drives the Price (Oct 2026)

Key takeaways

Higher interest rates tend to weigh on gold because it pays no interest.
Central banks bought a record 289 tonnes for a second quarter in Q2 2026 (World Gold Council).
Gold ETFs took in US$10 billion in September 2026; global holdings hit a record 4,256 tonnes.
When the Canadian dollar weakens against the US dollar, gold costs more in CAD even if the US price is flat.
Forecasts differ widely. We report them with dates and make no prediction of our own.

How do interest rates affect the gold price?

Gold pays no interest or dividends. When interest rates rise, especially after inflation (real rates), savings and bonds pay more, and holding gold costs you more in income you give up. J.P. Morgan’s research page says gold tends to underperform when yields rise, and it called a Federal Reserve hiking cycle the most significant bearish risk to its view (June 9, 2026).

The World Gold Council’s Mid-Year Outlook (July 1, 2026) adds that a rate hike is not always bad for gold; the reason for the hike matters. A shift back to expectations of lower rates would likely benefit gold, it said. Watch the US Federal Reserve as well as the Bank of Canada: gold is priced in US dollars, so US rates matter most.

Why does the US dollar matter, and what about the Canadian dollar?

Gold is priced in US dollars worldwide. A stronger US dollar makes gold more expensive for buyers using other currencies, which can reduce demand. The World Gold Council lists US dollar strength as a possible headwind for the second half of 2026, and its Q2 2026 report linked North American ETF selling partly to a stronger dollar.

For Canadians: the CAD price is roughly the US price × the number of Canadian dollars per US dollar. The Bank of Canada publishes that rate every business day.

Example (round numbers): for example, at US$4,000 an ounce and C$1.40 per US dollar, gold is about C$5,600. If the US price stays the same and the rate moves to C$1.35, gold falls to about C$5,400 for a Canadian, a 3.6% drop with no change in the US price.

How much gold are central banks buying?

Central banks are among the biggest buyers. According to the World Gold Council’s Gold Demand Trends for Q2 2026:

Central banks bought a net 289 tonnes in Q2 2026, a record for a second quarter and 62% more than a year earlier.
First-half 2026 purchases were 345 tonnes, the lowest first half since 2022, because Turkey, Russia and Azerbaijan sold heavily in Q1.
The National Bank of Poland was the largest Q2 buyer (51 t), followed by the People’s Bank of China (33 t).

In its Mid-Year Outlook (July 1, 2026), the Council estimated that each extra 20 to 30 tonnes of central-bank buying above the long-term average of about 600 tonnes a year should translate into roughly a 1% higher gold price, all else being equal. On the same logic, a clear slowdown in buying would be a headwind.

What role do gold ETFs, jewellery demand and geopolitics play?

ETF flows. Gold ETFs buy metal when investors put money in and sell when they take it out. In Q2 2026, they saw outflows of about 45 t. In September 2026, the World Gold Council reported inflows of US$10 billion, a record US$31 billion for Q3 and record holdings of 4,256 t. Canadian-listed funds added US$206 million in September.
Jewellery demand. High prices cut into jewellery buying. Jewellery use fell to 278 t in Q2 2026, down 17% from a year earlier and the lowest quarter since the pandemic, even though spending in dollars rose.
Geopolitics. Wars and crises push some investors toward gold as a safe haven. The Council says a 100-point monthly rise in a widely used geopolitical risk index has historically lifted gold by about 2.5%.

What are forecasters saying about the gold price?

These are views published by named institutions, in US dollars per troy ounce, on the dates shown. They change often and they disagree. We do not make our own forecast.

Source	Published	View
World Gold Council, Mid-Year Outlook	July 1, 2026	If conditions do not change much, gold may trade within about ±5% of US$4,100 in the second half of 2026. These are hypothetical scenarios, not forecasts.
J.P. Morgan Global Research	June 9, 2026	US$6,000 by Q4 2026; 2027 average US$6,263. Both were cut from February 2026 figures (US$6,300 and US$6,550).
Goldman Sachs note, as reported by investingLive (we have not seen the note itself)	Note from mid-September 2026; report dated Sept 23, 2026	End-2026 fair value estimate cut to US$4,650 from US$4,900; end-2027 target kept at US$5,400, assuming central-bank buying of about 90 t a month.

The gap between these numbers is the main lesson: well-resourced teams looking at the same data reach very different answers. Use forecasts to understand the arguments, not to time a purchase.

Gold prices can go down as well as up. Past prices don’t predict future prices. This page is general information, not investment advice. We review it monthly; last reviewed October 24, 2026.

To follow the price yourself, see gold price history in CAD, and if you are saving a little at a time, try the gold savings planner.

Common questions

Will the gold price go up?

No one knows. Forecasts from major banks and the World Gold Council differ by more than US$1,000 an ounce. Gold prices can go down as well as up.

Why does the gold price change every day?

Gold trades worldwide almost around the clock. Interest-rate expectations, the US dollar, investor flows and news events move it constantly.

Why is gold more expensive in Canada than the US price suggests?

Gold is priced in US dollars. The CAD price is the US price multiplied by the CAD/USD rate, so a weaker Canadian dollar raises it.

Is gold a good investment?

That depends on your goals and situation. Gold pays no income and its price can fall. This page is not investment advice; consider speaking with a licensed adviser.

Sources

Checked against these sources on October 24, 2026. Spotted something out of date? Tell us.

What drives the gold price (and what forecasters are saying)