WisdomTree expert Nitesh Shah sees gold on an upward trend despite violent fluctuations. New demand drivers could drive prices to record levels.
• Gold showed strong fluctuations in early 2026, with a record rise in January and a significant pullback in March
• New groups of buyers from Asia and the crypto sector are supporting demand
• Geopolitical risks and uncertainties continue to drive gold prices higher
According to a gold outlook from Nitesh Shah, head of commodities and macro research for Europe at WisdomTree, the gold market experienced extraordinary turbulence in the first quarter of 2026: Gold suffered its largest monthly loss since June 2013 in March, after recording its strongest rise since September 1999 in January. However, the expert maintains his assessment that the precious metal is moving towards a new, higher equilibrium level.
Since the beginning of the year, the price of gold has increased manageably and has risen from 4,315.09 US dollars (as of January 1, 2026) to 4,488.13 US dollars (as of June 2, 2026). This corresponds to an increase of around four percent.
According to the forecast, this development will be supported by a broader investor base: the new demand drivers include Chinese insurance companies, Indian pension funds and issuers of digital assets such as Tether. Inflows into gold ETFs in China and India have also increased significantly, it said.
Historical volatility challenges models
The start of the year was exceptionally volatile: at the end of January, the price of gold temporarily rose to almost 5,600 US dollars per ounce before falling back to around 4,100 US dollars by the end of March. Shortly afterwards, however, a significant recovery began.
In WisdomTree’s opinion, these developments show the limits of classic forecast models: The model, which is calibrated for the years 1995 to 2023 – a comparatively quiet phase on the gold market – is unlikely to have experienced comparable market changes to date.
Geopolitics remains an important driver
A key driver of the gold price fluctuations in the first quarter of 2026 was a series of geopolitical events: According to the expert, these included the change of power in Venezuela, discussions about a possible US takeover of Greenland and political pressure on the independence of the Federal Reserve. These events fundamentally supported the gold price, but led to above-average reactions.
According to WisdomTree, the end of March 2026 marks a turning point from which the price of gold rose again: The recovery occurred despite a stronger US dollar, rising yields and a shift in interest rate expectations – away from possible interest rate cuts by the Fed towards interest rate increases by the European Central Bank (ECB) and the Bank of England (BoE). Additional demand comes from new buyers: WisdomTree estimates that Tether will have purchased between 60 and 70 tons of gold in 2025. Central banks also continue to view gold as an important liquidity reserve.
Gold prices could reach new highs
As WisdomTree explains, citing data from the Bloomberg Survey of Professional Economists from March 2026, the consensus scenario is for gold to be around $5,500 per ounce over the next twelve months. The main drivers would be increased inflation, improved investor sentiment and ongoing geopolitical risks.
However, in the optimistic scenario, inflation rises to 4 percent, driven by higher energy prices and ongoing supply chain issues, according to WisdomTree. The US Federal Reserve is reacting cautiously while bond yields continue to rise. At the same time, the US dollar is losing value, the DXY falls to 90, it continues. This would be a favorable environment for gold: investors are increasingly looking for protection against inflation and a weaker currency, which should increase demand for the precious metal. In this scenario, the gold price forecast would be $5,872.
In the bearish scenario, in which the US Federal Reserve successfully reduces inflation to two percent, a decline to 4,600 to 4,650 US dollars per ounce would be conceivable, it continues. According to WisdomTree, gold is on its way to a new, higher equilibrium level. The growing investor base could be the decisive factor for this.
Svenja Polonyi, editorial team at finanzen.net
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