Gold Price Outlook: Rates To Fall After Diwali? HSBC Makes Big Prediction | Economy News

Gold prices have surpassed $4,300 per ounce in the international market.

The lamps of Diwali may have dimmed, but the sparkle of gold continues to dominate conversations among investors and households. Even after the festive buying rush, a key question remains, will gold prices cool down now, or is another rise on the horizon?

Global financial institution HSBC has released a report indicating that gold’s upward trajectory is unlikely to slow down anytime soon. In the international market, gold has already surpassed $4,300 per ounce. On October 18, it was trading around $4,362 per ounce (approx 28g), suggesting sustained bullish sentiment.

Gold To Reach $5,000?

HSBC expects gold to maintain its momentum even after the festive rush. The bank’s report suggests that gold could surge to $5,000 per ounce by the first half of 2026, a rise of nearly $1,000 from current levels. The forecast is driven by persistent geopolitical tensions, global economic uncertainty and the entry of long-term investors treating gold as a safe asset rather than a quick profit instrument.

Earlier, HSBC had projected an average gold price of $3,355 per ounce for 2025. This has now been revised to $3,455. For 2026, the estimate has been sharply increased from $3,950 to $4,600 per ounce. These figures, also cited by Reuters, reflect a shift in market behaviour where buyers are holding their gold instead of booking profits during price spikes.

Why Are Gold Prices Rising?

Several factors are contributing to this rally. According to a TOI report, central banks across the world are building up their gold reserves, investment in gold-backed exchange-traded funds (ETFs) is rising, and expectations of a cut in US interest rates are strengthening. Uncertainty linked to global trade disputes has further enhanced gold’s appeal as a safe-haven asset.

Recently, spot gold recorded one of its fastest weekly gains since December 2008, climbing above $4,300 per ounce. HSBC believes prices will likely remain elevated until early 2026, though some correction may occur in the latter half of that year.

What Are Other Banks Saying?

HSBC is not alone in its projection. Bank of America and Societe Generale have also set a target of $5,000 per ounce for the coming year. ANZ Bank expects gold to reach $4,600 by June 2026 before witnessing a gradual decline.

With major global banks forecasting sustained strength in gold prices, a drastic fall after Diwali appears unlikely.