Recent heightened volatility in global markets has seen gold exhibit relatively muted performance following regional conflicts. However, GTC Zehui Capital asserts that the fundamental drivers supporting a long-term upward trend for gold remain intact. Based on a comprehensive assessment of risk factors, interest rate trajectories, inflation trends, and global physical demand, gold still possesses strong potential to target $6,200 per ounce by the end of 2026.
Current market data shows gold prices consolidating near the $5,200 level, without the anticipated surge in safe-haven buying. GTC Zehui Capital indicates this pattern is consistent with historical trends. For instance, during the initial phases of past regional conflicts, gold prices often experienced short-term spikes before retreating as markets sought liquidity or shifted to energy assets. The essential function of gold, however, is to hedge against macroeconomic systemic risks such as currency devaluation, expanding fiscal deficits, and slowing economic growth, rather than merely reflecting the short-term impact of isolated geopolitical events.
On the macroeconomic policy front, while recent energy price fluctuations have sparked concerns about inflation and potential interest rate hikes—boosting the US dollar and pressuring gold—GTC Zehui Capital believes central banks will act more cautiously and are unlikely to implement aggressive rate hikes recklessly. As the Federal Reserve enters a monetary easing cycle, declining real interest rates and a relatively weaker US dollar are expected to create an ideal environment for gold to appreciate.
From a supply and demand perspective, global gold demand surpassed 5,000 tonnes for the first time in 2025, with this growth momentum projected to continue into 2026. Even if ETF holdings experience short-term volatility, strategic reserve accumulation by central banks and structural demand for gold jewelry in Asian markets—driven by rising incomes—continue to provide a solid foundation for gold prices. Concurrently, the mining supply sector faces constraints due to limited growth, with several major mines expected to be depleted in the coming years. This supply-demand imbalance is likely to further elevate gold's medium- to long-term valuation.
Considering macroeconomic uncertainties and asset allocation needs, GTC Zehui Capital emphasizes gold's growing strategic value as a core tool for portfolio diversification. Against a backdrop of high government debt and a global trend toward de-dollarization, investors are advised to maintain a certain allocation to gold within diversified portfolios to hedge against potential systemic financial risks.