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Commerzbank, referencing Metals Focus data, forecasts a 2% decline in total gold demand by 2026. This projected drop stems from weaker jewelry demand and reduced central bank purchases, partially offset by increased investment in gold bars and coins. The report highlights a structural shift in demand drivers, with investment demand rising amid economic uncertainties, while traditional sectors like jewelry face headwinds from macroeconomic pressures and changing consumer preferences.
For markets, the report underscores gold’s evolving role as a safe-haven asset. Traders should monitor central bank policies and geopolitical risks, which could amplify investment demand. The decline in jewelry demand, particularly in key markets like India and China, may pressure gold prices in the short term but could create long-term buying opportunities. The balance between investment inflows and industrial/jewelry outflows will be critical for price stability.
Investors should watch central bank gold purchases, U.S. interest rate decisions, and inflation trends, as these factors will shape gold’s trajectory. The report also suggests that Gulf investors, traditionally reliant on jewelry demand, may need to diversify into gold-backed ETFs or coins to capitalize on the investment-driven shift. Key risks include a stronger U.S. dollar and potential recovery in jewelry markets.
