Gold has continued to outperform forecasts this year, reinforcing its reputation as the ultimate safe-haven asset. UBS has upgraded its projections, expecting an average of $3,600 per ounce in Q1 2026 and $3,700 in Q2 2026, levels it anticipates will hold into the following quarter. After reaching a record $3,500 in April 2025 and consolidating around $3,300, the market now appears set for another push higher.
The upward momentum is underpinned by structural and cyclical drivers. Central banks remain steady buyers, with nearly 1,000 tonnes expected in 2025, while ETF inflows have climbed to near-pandemic highs, with UBS lifting its forecast to almost 600 tonnes for this year. Global gold demand is projected to rise 3% to 4,760 tonnes, the highest since 2011. At the same time, macroeconomic conditions, stagflation risks, fiscal uncertainty, and expectations of a cumulative 50 bps of Fed rate cuts by December 2025, continue to provide strong tailwinds for gold. Lower real yields and geopolitical tensions further strengthen the case for higher prices.
For retailers and stockists, this environment creates both opportunities and challenges. Rising prices typically mean thinner consumer demand for heavier jewellery pieces, but higher-margin products such as bars, coins, and lighter-weight jewellery often see resilient turnover. In the UAE, for instance, many customers are advancing wedding purchases to secure lower rates, while others are shifting toward smaller denomination pieces or alternative products. Jewellery sales in 2024 fell 13% in the UAE, yet bullion bar sales and gold-for-investment demand have remained relatively steady.
To prepare, retailers should focus on inventory efficiency and liquidity management rather than overextending at current elevated levels. Aligning stock with fast-moving categories, smaller bars, coins, and lightweight jewellery, can help maintain cash flow. At the same time, clear communication of daily price movements and transparent pricing policies will be critical to sustaining customer trust, especially as volatility increases. Retailers may also find value in encouraging gold exchange and recycling programs, which help replenish stock without heavy reliance on fresh imports.
Equally important is balancing exposure. While stocking large, high-value items becomes riskier in a rising-price environment, maintaining a healthy mix of affordable, frequently purchased products ensures consistent turnover. Retailers should also watch for consumer shifts into substitutes, such as lab-grown diamonds or lighter design trends, and adapt showcases accordingly to retain footfall.
In short, while global banks like UBS and Citi are signalling further strength in gold into 2026, retailers must adopt a disciplined approach: focus on liquidity, stock rotation, and product mix optimization. Those who manage inventory prudently, strengthen customer engagement, and stay flexible in their offerings will be best placed to navigate elevated price levels while protecting margins and sustaining demand.
Gold Surges Beyond Forecasts – Insights & Tips for Retail Success from Century Financial
