• Gold is expected to rebound in the second half of 2026, with Navellier & Associates targeting $4,500 an ounce after a 25% drop from January's record high.
  • Central bank purchases and potential monetary easing in Europe are key catalysts for the recovery.
  • Near-term pressure persists, but structural demand from official sector and investment flows underpins the bullish outlook.

Pullback Sets Stage for Recovery

Gold prices have tumbled about 25% since hitting an all-time high in January, but the selloff may be short-lived. According to Navellier & Associates, the precious metal is poised for a rebound in the second half of 2026, driven by continued central bank buying and the prospect of monetary easing in Europe. The firm sees gold climbing back toward $4,500 an ounce, a level that would recoup most of the recent losses.

“The fundamental drivers remain intact,” said a Navellier strategist, who asked not to be named because the views are not public. “Central banks are still accumulating, and if the European Central Bank signals a dovish tilt, that could reignite investment demand.”

Central Banks: A Persistent Tailwind

Central bank purchases have been a cornerstone of gold's rally over the past two years, and analysts expect that trend to continue. Data from the World Gold Council show that official sector buying has remained robust in 2026, even as prices softened. Diversification away from the U.S. dollar and geopolitical uncertainty are likely to keep central banks engaged, providing a floor under gold.

“We’ve seen persistent accumulation from emerging-market central banks, and that’s not going to change overnight,” said a precious metals analyst at a European bank. “If anything, the pullback is an opportunity for them to add at lower levels.”

European Easing as a Catalyst

Potential monetary easing in Europe could be a key trigger for gold’s second-half rally. Markets are pricing in a rate cut by the European Central Bank later this year, which would reduce the opportunity cost of holding non-yielding bullion and weaken the euro, boosting dollar-denominated gold. The ECB has hinted at a more accommodative stance as inflation moderates and economic growth stalls.

“A shift in European policy could be the catalyst that re-accelerates gold,” said the Navellier strategist. “Combine that with ongoing central bank buying, and the setup for later this year looks bullish.”

Investment Demand to Resume

Exchange-traded fund flows and bar-and-coin purchases have slowed in recent months, but analysts expect them to pick up as macro conditions shift. Gold ETFs saw net outflows in the first quarter, but if rate cuts materialize, that trend could reverse. “Investment demand tends to lag price action, but once momentum re-establishes, we’ll see inflows again,” said a fund manager focused on commodities.

Near-Term Risks Remain

Despite the bullish second-half outlook, gold faces headwinds in the short term. A resilient U.S. economy and sticky inflation could delay Federal Reserve rate cuts, keeping real yields elevated. Meanwhile, jewelry demand has softened due to high prices, and physical buying in key markets like India and China has been patchy. “The near term is still uncertain,” the bank analyst cautioned. “We could see further downside before the recovery takes hold.”

Long-Term Structural Support

Beyond 2026, structural factors such as de-dollarization, rising global debt, and geopolitical risks are expected to underpin gold demand. Navellier’s $4,500 target aligns with forecasts from other major institutions, which see gold reaching $4,000–$5,000 over the next year or two. “The long-term case for gold is as strong as it’s been in years,” the Navellier strategist said.

Correction: An earlier version of this article misstated the percentage decline from the high. It is about 25%, not 20%.