Gold is currently making a new attempt to significantly surpass the $4,000 per ounce mark. According to ING analysts, however, the recent period of weakness was and remains part of a normal consolidation – the fundamental drivers for gold remained intact.
In their monthly update, the experts continue to expect an average gold price of around $4,000 for the fourth quarter; however, by the first quarter of 2026, they anticipate an increase in the average price (!) to approximately $4,100. Key factors are the sustained demand from central banks, the precious metal’s function as a “safe haven,” and a potential resumption of ETF inflows amid continued interest rate easing in the US.
Gold: Consolidation Instead of Trend Reversal
From ING’s perspective, the correction in the gold market following the rapid rally to last month’s record highs is an overdue ‘cooldown’. Despite pullbacks, the price remains significantly in positive territory since the beginning of the year. Accordingly, this movement is not assessed as a trend reversal, but as a healthy market correction that reduces overextended positions. In an environment of ongoing geopolitical and economic uncertainties, gold remains in demand as a hedging component – among both private and institutional investors. This means: volatility is possible, but the underlying factors remain.
Interest Rates, ETFs, and Investment Demand
In the short term, interest rate prospects influence sentiment. Statements by Fed Chair Jerome Powell, suggesting that a December rate cut is not a certainty, recently curbed momentum in the gold market. Nevertheless, according to FedWatch data, the futures market continues to price in a high probability of easing. ING expects that a sustained interest rate cutting cycle will lower the opportunity cost of holding gold, thereby drawing investors back into gold-backed ETFs.
Already in the third quarter, expectations of lower interest rates contributed to strong inflows: According to the World Gold Council, global holdings of gold-backed ETFs increased by 222 tonnes between July and September. Demand for bars and coins also remained robust – an indication that physically-oriented investors utilized the consolidation.
Central Banks as a Stable Demand Base
A central pillar for gold is the continued buying appetite of central banks. After two quarters of declining pace, central banks significantly ramped up their purchases again in the third quarter: Approximately 220 tonnes net went into state coffers – 28% more than in the second quarter and 6% above the five-year average.
In addition to the major long-term buyers, new players are also coming into focus: South Korea’s central bank is reportedly considering its first gold increase since 2013; Serbia’s president announced plans to nearly double national gold reserves by 2030. ING interprets this development as a structural shift in reserve policy – gold is being given greater weight as a neutral, liquid asset.
What this Outlook Means for Gold
For the coming months, a mixed but generally supportive picture for gold is emerging. On the one hand, there is a consolidation after record highs, which brings with it technically induced fluctuations. On the other hand, fundamental factors are at play: central bank purchases form a floor, physical demand remains solid, and a probable further decline in US interest rates could re-energize investment flows into ETFs. Therefore, ING expects average prices of around $4,000 per troy ounce in the fourth quarter and $4,100 in the first quarter of 2026.
Crucial for the short-term direction will likely be the next signals from the US Federal Reserve, data from the US labor market, and the development of the US dollar. A stronger dollar can temporarily curb gold prices; however, according to ING’s interpretation, the influence of falling real interest rates and structural demand from central banks will prevail in the medium term. Thus, gold remains in focus – as an established hedging instrument and as a component that can provide portfolio effects during periods of increasing uncertainty.
Conclusion: Despite headwinds on the way past the $4,000 mark, ING considers the gold story intact. The bank views short-term pullbacks as part of the consolidation, while structural demand sources – central banks, physical purchases, and potentially re-accelerating ETF inflows – create a robust framework for the turn of the year and the start of 2026.
