New Delhi: Gold prices could climb to $5,000-$5,600 per ounce and silver could reach $95-$120 per ounce by the end of 2026 if a bullish scenario for precious metals materialises, according to a new report by Monarch PMS.
The report has assigned a 25 per cent probability to the bull-case scenario. It assumes weakness in the US labour market could prompt the Federal Reserve to ease interest rates, while real yields decline. A renewed shift by institutional investors towards precious metals and tighter physical supplies of silver would further support the rally.
Base Case Sees Gold at $4,300-$4,700
Under its base-case scenario, which carries a 55 per cent probability, Monarch PMS expects gold to trade between $4,300 and $4,700 per ounce, while silver could remain in the $70-$85 range by the end of 2026.
The base case assumes the US Federal Reserve keeps interest rates unchanged through September, energy prices normalise, real yields stabilise and central banks continue purchasing gold at around 250 tonnes per quarter.
Bear Case Could Push Gold Below $4,000
The report assigns a 20 per cent probability to its bear-case scenario. Under this outlook, gold could fall to $3,400-$3,900 per ounce, while silver could decline to $45-$55 per ounce.
This scenario could materialise if the Federal Reserve raises rates in September, oil prices fall further and disinflation develops into weaker demand.
The report identified the US 10-year TIPS real yield, currently at 2.41 per cent, as a major headwind for gold because higher real yields provide an alternative return to the non-yielding precious metal.
Silver Supply Deficit Remains Supportive
Monarch PMS said silver’s underlying supply-demand dynamics remain favourable, with the market heading towards a sixth consecutive annual deficit.
The report noted that around 762 million ounces have been drawn from above-ground silver stocks since 2021, while mine supply has remained broadly flat for about a decade.
Physical tightness could amplify silver’s upside if investment demand strengthens. The report also highlighted that paper claims on COMEX are roughly 5.6 times registered physical inventories.
Meanwhile, the gold-silver ratio has risen from around 46 times at January’s peak to approximately 69 times, close to its 21st-century average. According to Monarch PMS, silver has surrendered much of its earlier outperformance and now appears relatively cheaper compared with gold.
