TD Securities Lowers Gold Price Forecast for Second Half of 2026 Amid Fed Rate Hike Expectations

TD Securities has revised down its gold price forecasts for the latter half of 2026 as markets increasingly anticipate a Federal Reserve interest rate hike by the end of the year. The Canadian bank points to rising inflation and energy prices, driven by geopolitical tensions, as key factors influencing gold and precious metals markets.

Revised Gold Price Forecasts for H2 2026

TD Securities cut its average gold price projection for Q3 2026 to approximately $4,550 per ounce, a 3% decrease from earlier estimates. For Q4, the forecast was reduced by 10% to an average of about $4,700 per ounce. The revisions reflect market expectations for tightening U.S. monetary policy, as a rate hike in December 2026 is now seen as more than 50% likely.

Inflation, Energy Prices, and Fed Policy Impact

The ongoing conflict in the Middle East, particularly in Iran, has led to significant supply disruptions and higher oil prices — forecasted by TD Securities to average $104 per barrel with potential spikes to $150. This energy-driven inflation pressure is contributing to higher bond yields and a stronger U.S. dollar, creating headwinds for gold prices. Rising interest rates increase the opportunity cost of holding non-yielding gold bullion, thereby weighing on demand.

Longer-Term Outlook Brightens for Gold and Other Metals

Despite near-term challenges, TD Securities anticipates a recovery in gold prices by the second quarter of 2027, forecasting an average of $5,350 an ounce – a 7% increase from previous long-term outlooks. The easing of inflationary pressures following the resolution of geopolitical conflicts, lower interest rates, and a weaker dollar are expected to support this rebound. Central bank buying and heightened geopolitical risks could also spur renewed safe-haven demand.

TD Securities also upgraded its outlook for silver and platinum group metals (PGMs). Silver prices are expected to rise steadily through late 2026 and into mid-2027, supported by supply deficits and demand linked to both investment and industrial use.

Key Details

• TD Securities lowered gold price forecasts for Q3 to $4,550/oz and Q4 to $4,700/oz.
• Markets predict over a 50% chance of a Fed rate hike by December 2026.
• Brent crude oil is forecasted to average $104/barrel with risks of spikes to $150.
• Gold could test critical support near $4,000/oz if oil remains above $100/barrel.
• Gold price expected to rebound to $5,350/oz by Q2 2027 with easing inflation.
• Silver and PGMs outlook upgraded due to continued supply constraints and demand growth.

Why It Matters

Gold prices are sensitive to the interplay of inflation, real interest rates, currency strength, and geopolitical risks. Expectations of higher Fed rates typically dampen gold market sentiment due to increased yields on bonds and a stronger U.S. dollar. Meanwhile, rising energy costs from Middle East tensions sustain inflation risks, which tend to support precious metals as an inflation hedge. TD Securities’ revised forecasts highlight how these dynamics drive near-term volatility but also set the stage for gold’s recovery as macroeconomic conditions evolve.

Conclusion

TD Securities’ downward revision of gold price forecasts for the second half of 2026 underscores the impact of expected Fed tightening and inflationary pressures linked to geopolitical instability. However, the bank’s optimistic long-term view signals potential strength in the gold market by 2027, supported by easing inflation, lower rates, and persistent safe-haven demand. Investors tracking gold bullion and broader precious metals markets should watch Fed policy developments alongside geopolitical and energy market trends influencing inflation and global economic growth.

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📝 About This Article  

This article was generated by Hivebox AI in collaboration with nGRND.
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