TD Securities, through analyst Ryan McKay, projects that gold is entering a new bullish phase, with the potential for spot prices to make a sustained move above $5,000 per ounce into 2027 [1]. The report highlights that gold has demonstrated resilience, maintaining strength despite further Federal Reserve interest rate hikes, and attributes this to growing investor and central bank appetite, as well as ongoing de-dollarization and increased demand from China [1].
The analysis notes that flows from long-term investor cohorts have accelerated in recent months, which is expected to help gold withstand a higher interest rate environment and fuel a renewed bull run [1]. TD Securities points out that with three more Fed hikes already priced into the market, any disappointment in the Federal Reserve's ability to deliver these hikes could further accelerate gold's upside potential [1].
While systematic funds (CTAs) have recently been net sellers, weighing on the late summer rally as they liquidated long positions ahead of the September FOMC meeting, momentum fund positioning is now described as 'fairly clean.' This could provide additional upside if discretionary flows reignite the rally, as anticipated by TD Securities [1].
Central bank flows are also reported to be accelerating, with both reported and unreported central bank buying expected to show a strong pace of accumulation this year. The themes of de-dollarization, dollar debasement, and fiscal distrust are cited as key market drivers supporting this trend [1].
CONCLUSION
TD Securities anticipates a significant bullish phase for gold, driven by robust investor and central bank demand, with spot prices potentially exceeding $5,000 per ounce by 2027. The outlook is supported by macroeconomic drivers and the possibility of further upside if Federal Reserve policy expectations are not met. Market participants are advised to monitor central bank flows and investor positioning as key indicators for gold's trajectory.