The World Bank's Precious Metals Prognosis for 2026 and 2027 offers a unique perspective on the trajectory of gold and silver, forecasting a decoupling from broader commodity trends, a peak in momentum in 2026, and a market normalization by 2027. According to the World Bank's October 2025 Commodity Markets Outlook, gold and silver prices are expected to reach an average of $3,575 and $41 per ounce, respectively, in 2026, setting new annual highs. Soon after, the impressive rally in these precious metals is slated to conclude in 2027. Interestingly, this trajectory counters effective commodity trends, which the World Bank projects will decline for the fourth consecutive year, reaching a six-year low in 2026. Precious metals, mainly considered monetary assets, are identified as exceptions to this downturn, diverging from the broader, cyclically sensitive commodity markets.
The spike in 2026, although confirmed, will be notably smaller compared to the historically large surges seen in 2025; projections indicate that the momentum of a 40% to 50% increase as seen in the past years, driven by investment demands, could face "selling pressure" and come to an end by 2027 as the market normalizes. Yet, gold and silver prices will remain relatively high, surpassing their 2015-2019 averages by over 180%.
Within the context of a generally deflated global commodity landscape, this contrary surge in precious metals reveals how structural weaknesses in the broader market, fueled by sluggish global growth, policy uncertainties, and trade turmoil, contribute to this divergence. The World Bank points to poor performance in the energy sector, marked by falling energy prices that contribute to global disinflation and the expansion of a global oil glut, as significant downward vectors influencing commodity markets. In the face of these market hardships, growth in gold and silver prices is likely imposed by anti-cyclical forces. Decreasing industrial growth, stability in prices of general metals and minerals, and the growth in geopolitical and systemic solvency concerns contribute to the continued appreciation of gold's value, verifying evidence of a decoupling from broader economic growth indicators.
While the World Bank’s forecast acknowledges new annual average highs for both precious metals in 2026, it additionally signals a reduction in the rate of appreciation for these metals. Gold's anticipated 5% increase in 2026 is considerably conservative, contrasting the massive 50% rally recorded in 2025. Silver’s projected increase, although slightly stronger at 7.9%, is still modest compared to its 34% rise in the previous year. This cutback in growth is suggestive of a possible reduction in speculative investment and safe-haven flows, attributable to a “burnout” of crisis hedging that catalyzed the 2025 rally. However, this deceleration does not suggest a decline. Newly projected average prices being significantly higher in 2026 than those recorded in the 2015-2019 period underscore maintaining structural support as an important factor.
The World Bank suggests that a majority of the speculative and tactical investment flows, which tend to exit the market when the rate of price appreciation falls substantially, contribute to the anticipated "selling pressure." However, the continued purchases by central banks can help maintain a high structural price floor.
Besides central bank purchases, which provide a non-cyclical signal of confidence in gold as a long-term value asset, the World Bank remains hopeful about silver. It highlights robust industrial demand coupled with investment flows primarily based in renewable energy and semiconductor production sectors as forces sustaining silver's trajectory, insulating it from the declining cyclicity that affects other base metals.
Despite optimism about the continued growth of precious metals, the reasoning behind the anticipated market normalization in 2027 remains unclear. Since explicit rationale for this pivot, such as changes in interest rates, specific inflation targets, or dollar strength, remains unspecified, one must infer from the situation encountered during the 2025-2026 surge.
The concluding rally suggests a stabilization of the global macroeconomic environment, contingent on the resolution of geopolitical tensions, stabilization of monetary policies and real yield, and a decline of the speculative and tactical investment flows. Upside and downside risks that may impact the World Bank’s baseline forecast include geopolitical tension, oil sanctions and disruptions, expansion of the AI sector, and a global economic downturn. The World Bank's conservative approach contrasts with more aggressive forecasts by investors, suggesting higher prices. These forecasts are proposed based on the expectation of severe monetary distress triggering speculative and official flows into gold.
In conclusion, the World Bank’s Commodity Markets Outlook implies a transition from the era of explosive growth to one of high-level consolidation, outlining strategic considerations for investing in these precious metals, adjusting allocation based on shifting return drivers, and closely tracking macroeconomic indicators.