Will gold prices fall further? Check reasons behind the recent dip, forecasts and more
Gold’s fall has left investors wondering whether to buy, wait or sell. Prices have dropped around 5% in 2026 and 13.6% over six months. According to TradingView, spot gold stood near $4,194.65 per ounce on 10 October.
Why are gold prices falling?
Rising US bond yields are the main reason for the recent fall. The US 10-year Treasury yield has climbed to around 5.27%. Gold does not pay interest, making higher-paying bonds more attractive to investors. This can reduce demand for gold.
A stronger US dollar has also put pressure on gold prices. The Dollar Index has gained over 3% this year. Fears of further US interest-rate increases have also weighed on gold.
Higher crude oil prices linked to Iran conflict concerns have increased inflation worries. Continued uncertainty and investors booking profits after record highs have also pressured gold.
International gold prices have fallen roughly 26% from 29 January’s peak of $5,595. Indian prices have declined nearly 23%.
Why do experts remain positive?
Mirae Asset MF points to central bank buying as a reason for optimism. It expects the central bank demand to be near 700 tonnes in 2026. That exceeds the 2010-2021 average of 470 tonnes. Central banks buy gold to spread their reserves across different assets.
Emerging economies are also reducing their reliance on the US dollar. Gold remains attractive because it can preserve value and is easily traded.
Risks involving energy supplies, trade routes and government debt also support interest in gold. India’s festive and wedding demand could support prices. Navratri, Dussehra, Dhanteras, and Diwali are among the occasions expected to boost spending.
Gold prices forecast
JP Morgan forecasts an average of $6,000 per ounce during 2026’s final quarter. It expects prices around $6,300 by late 2027.
However, JPMorgan has lowered its forecasts relative to its February 2026 estimates. Its final-quarter 2026 forecast fell from $6,300 to $6,000.
The bank’s Greg Shearer acknowledged in June that investor interest had weakened. He linked caution to uncertainty over energy prices, inflation and possible US rate increases.
“…with growing worries that the Fed might have to respond to energy-driven inflation with hikes, gold is on the back burner for most investors at the moment,” Shearer said in June.
Could gold fall further?
Further weakness remains possible, while longer-term demand could support prices. Price forecasts reflect expectations and do not guarantee future returns.
Clarity around the Iran conflict could influence energy prices, inflation and bond yields. Those developments may shape gold’s next move. As of now, there is no certainty about whether gold prices will fall sharply again.
