Gold Prices in US to reach $4,000 per ounce in 2026. That would be about 20% higher than current levels.
Bank of America Predicts Gold to Hit $4,000 Amid Soaring Demand and U.S. Debt Concerns
Bank of America has significantly raised its outlook on gold, now forecasting the precious metal to reach $4,000 per ounce by 2026—a jump of nearly 20% from its current price near $3,330. Gold has already climbed over 40% in the past year alone, continuing a multi-year rally that has seen prices surge due to rising demand and global uncertainty.
What’s Driving the Gold Boom?
Gold has gained 45% so far in 2025, after climbing more than 20% in each of the previous two years. Over the last decade, gold’s total return has soared 180%. Key reasons include:
- Increased buying by central banks
- Stronger investor demand
- Economic instability
- Geopolitical conflicts including the Russia-Ukraine war, Israel-Iran tensions, and U.S. military involvement abroad
While global unrest plays a role, Bank of America analysts say it’s not the main driver behind the future surge in prices.
Gold and the U.S. Economy: The Trump Factor
According to BofA, a major factor behind their bullish forecast is former President Donald Trump’s proposed economic plan, dubbed “Big and Beautiful.” Though versions differ in the House and Senate, both could significantly increase U.S. spending and reduce revenue through tax cuts.
“Regardless of Senate negotiations, market concerns about fiscal sustainability are unlikely to abate,” Bank of America wrote. “Interest rate volatility and a weaker US dollar should continue to support gold, especially if the US Treasury or the Fed are forced to step in.”
Trump’s plan is projected to add $2.8 trillion to the national debt over the next decade, potentially shaking market confidence in U.S. fiscal stability.
A Weakening Dollar, Stronger Gold
So far in 2025, the U.S. dollar has declined by 10%, while gold has overtaken the euro to become the second-largest global reserve currency. This shift has been driven in part by central banks in emerging markets, who are purchasing more gold as a hedge against trade tensions and rising debt in Western economies.
A World Gold Council survey shows a continued trend of central banks choosing gold over U.S. Treasuries, citing concerns about Washington’s growing deficit.
“This should be a wake-up call for U.S. policymakers,” BofA analysts warned. “If confidence in the U.S. economy continues to slip, gold demand could grow even more.”
Debt Levels Reach Concerning Heights
As of May 2025, the U.S. national debt stands at $35.46 trillion, with a Debt-to-GDP ratio of 123%—a potential red flag for future repayment risks. The government is now spending $776 billion annually just to cover interest payments, amounting to 16% of the entire federal budget.
The World Gold Council echoed BofA’s sentiment, saying that while global tensions and interest rates play a part in gold’s momentum, rising concern about U.S. debt is becoming a dominant factor. While a full-blown crisis remains unlikely, smaller financial shocks are becoming more probable.
Outlook: Gold May Keep Rising
With economic uncertainty, a weakening dollar, and rising national debt, investors may continue turning to gold as a reliable store of value. If these trends continue, Bank of America’s $4,000 forecast may not only be achievable—but possibly even conservative.
