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Informist, Friday, Sept. 12, 2025

MUMBAI – Commerzbank has raised its price forecast for gold to $3,800 per ounce by the end of 2026 from its earlier projection of $3,600 per ounce as it expects the US Federal Reserve to lower interest rates by a total of 200 basis points by the end of next year. "This is because the key interest rate would then be even slightly lower than the market is currently pricing in," it said. The German bank has also raised its 2026 year-end price forecast for silver to $43 per ounce from $41 per ounce expected earlier.

US tariffs are also likely to have an increasing impact on consumer prices, meaning that inflation will rise, although gradually, Thu Lan Nguyen, head of FX and commodity research at Commerzbank, said. The resulting decline in US real interest rates will be beneficial for gold, as a non-interest-bearing investment. Silver is likely to benefit from the upward trend in gold. "This is probably partly due to the fact that the already high price of gold is deterring some investors, who are therefore looking for cheaper alternatives," Nguyen said.

The focus of the precious metals markets next week will undoubtedly be on the US Federal Reserve meeting, where a 25-basis points interest rate cut has already been priced in by market participants. There is also the possibility that the Fed will take an even more aggressive step of lowering rates by 50-bps, Nguyen said. "This is supported by the significant slowdown in the labor market on the one hand and the continuing high political pressure on the other," Nguyen added.

Nguyen said there is a good chance that Stephen Miran, a close ally of US President Donald Trump, will take the place of outgoing Fed Governor Adriana Kugler in time for next week's meeting, thereby increasing pressure on the central bank "from within." If the Fed does indeed surprise with a larger interest rate cut, gold prices are likely to resume the recent rally and climb to a new record high.

The German bank has also raised its price forecast for platinum to $1,400 per ounce for the end of 2025 from its previous forecast of $1,350 per ounce and has confirmed its year-end forecast for 2026 at $1,500 per ounce.  End

US$1 = INR 88.27

Reported by Ashutosh Pati

Edited by Ashish Shirke

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