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Gold Pulls Back on Middle East Truce and Trade Optimism, but BofA Holds $4,000 Target

Rising US fiscal deficits are expected to sustain gold’s rally toward $4,000 next year

Overview

  • Gold slid about 1.3% to $3,283.56 per ounce after a ceasefire between Israel and Iran and progress on a US-China trade framework eased haven demand
  • Silver remains near multi-year highs around $36.4 per ounce with a weaker dollar and ongoing safe-haven flows
  • Bank of America analysts maintain a 2026 gold forecast of $4,000 per ounce, citing President Trump’s “Big and Beautiful” plan and mounting US deficits as primary drivers
  • Global central banks continue to boost gold reserves, contributing to a more than 40% price increase over the past year
  • US debt-to-GDP topping 123% and interest payments consuming 16% of federal spending are expected to underpin further gold demand despite short-term profit taking