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SIMON BROWN: I’m chatting now with Taylor Burnette. He is a research lead: Americas, for the World Gold Council. The Gold Mid-Year Outlook 2026 has just been published.
Taylor, appreciate the time. Gold – I think a dozen all-time highs this year; it got above $5 500/oz intraday in late January. Since then it’s been under pressure.
But the biggest story – if I zoom out and worry less about perhaps a six-month chart but look at one year or two years – three years ago gold was sub-$2 000/oz and it has doubled in the three years.
TAYLOR BURNETTE: Yes. Thank you again for having me. I think that’s a really good point to think about. We all get stuck in this the short-term noise and all the other the trading dynamics that have happened in the near term.
But to your point, look at where we were two or three years ago. Even if we take the last half of ’25 and the first half of this year, gold is still one of the best-performing assets.
So, while the correction has been notable and we’ve been talking about it a lot, and you hear it in the media, it was also somewhat warranted. We’ve got to have a little bit of mean reversion. We’ve got to settle down. We’ve got to bake in the rest of the news.
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Essentially what it was showing is that everything, up until the precious metals selloff in late January or early February to the US-Iran conflict in late February going into March – all that started to get priced in, all that run-up. You kind of had an idea that the geopolitical risk was playing out and everything was getting baked in.
So yes, now that we look at the current gold price, right now it is essentially baking in everything that has already happened – all the rest of the drawdown that has happened.
And so yes, it’s been a great two, three years, and it’s been a little choppier in the last two or three months. But overall, I think to your point, I would say we’ve got to remember the long term. We’ve got to remember where we came from, and we still believe the long-term story is intact for gold.
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SIMON BROWN: Hundred percent. And your analysis from the World Gold Council, saying that if conditions do not change materially – and I appreciate there’s a big ‘if’ there, but let’s take that as a given – you’re looking at gold trading around $4 100/oz, give or take 5%, but sort of $4 100, all things being equal.
TAYLOR BURNETTE: Yes, yes. Here at the Gold Council we don’t give a specific price forecast – that maybe you’ll see a lot of the sell-side and traditional research houses put together. But yes, we like to put things in ranges and bands and kind of give an idea of where we think things could go.
And to your point, the macro or base case kind of to a degree, which we don’t really use – we just call this more the macro consensus – everything that’s being baked in, to your point plus or minus 5%. We may trade sideways here. And then if things deteriorate more, then there’s a case for the upside and we can dive into that. Or if things go the other way there’s a downside.
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So the upside we would say anywhere from 5% to 20%, and the downside anywhere from another 5% to 15%. But ultimately it’s been nice to see; even on the range-bound macro market consensus view, what’s been good to see is a lot of support around that $4 000 level.
Also worth noting is a lot of that buying does tend to happen in Asia trading session hours or in Europe. And so you’re starting to see different parts of the world. It really highlights [how] we look at things.
Being based in the US everybody wants to talk about what’s going on here, but gold is a global asset. You’ve got to look at it through why other regions and why other countries are buying gold, and why central banks are doing what they’re doing. So yes, it’s been really good to see that.
If we see selling in the US sessions, we typically start to see buying the next day out of Asia and then in Europe.
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SIMON BROWN: Yes. I found that a fascinating part of the research report. Pushing it higher – for gold to sort of go beyond the band that you’re talking about – this really is around ‘watch the economy’. And if we see worsening geopolitical conditions, deterioration there, a reversal in interest rate expectations, these are the classic drivers for gold.
TAYLOR BURNETTE: Exactly. And all these sorts of drivers are always going to be more of your near-term impacts and effects. That’s why we started to see this most recent pullback.
Well, I was saying earlier we believe the long term story remains intact – central bank diversification, broader portfolio diversification, things like that.
But to your point on what could push it higher, at the beginning of the year the whole story was okay, the Fed’s got to cut, the Fed’s got to cut, the Fed’s got to cut. Then we have the oil-price shock and we have the conflict. And then you almost have this perfect storm which hit all at once. That’s what drove gold back down lower.
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So if we continue to see more geopolitical tensions rearise – it doesn’t necessarily mean the US and Iran or the Middle East, it could be resumption of things going on in Europe or anywhere else, places we’re nor even thinking of – any of those sorts of shocks should again help push gold higher.
If we see a reversal of the interest-rate expectations, that should also be another positive. At the beginning of the year we were sitting here looking at the Fed and they said, hey, we have a dual mandate.
Let’s look at rates, also look at inflation and let’s look at labour. Labour shouldn’t show great signs. But then you have an oil-price shock, and inflation is moving higher. So all of a sudden rate cuts are off the table, rate hikes are on the table, and obviously higher opportunity costs make gold less attractive.
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But again, as things are starting to stand, you begin to hear some commentary from the Fed that maybe this is transitory – whether or not you believe the whole transitory narrative and wording of things. But essentially it’s hey, we have to see the data. We’ve got to see how it’s going.
It’s also seeing how this Fed acts. We’ve been so accustomed to years with [Jerome] Powell, and it’ll be really interesting to see how [Kevin] Warsh handles everything. I also would always caveat that it’s [not] one person changing it at the helm. It is a committee. So it’s important to look at what everybody is saying, what everybody’s thinking.
So to your point, yes, it’s worsening economic or geopolitical conditions, a reversal in interest-rate expectations and, then again, just long-term investor participation. As I was saying, there are signs that people are stepping in to buy these dips, and that’s really helpful.
SIMON BROWN: And of course central bankers have been big buyers. I was going to say ‘over the last few years’, but truthfully it’s about a decade or so that they’ve been up in their buying.
You had the Central Bank Gold Reserves Survey 2026 earlier in the year, and central bankers are saying, yes, this is likely to continue. We saw a bit of selling; we saw some swaps in Q1. But in the longer-term trend, central banks are still there and still going to be buyers.
TAYLOR BURNETTE: Yes, yes. I would really point all of your listeners to our recent central bank survey. It’s a master class in being able to see what everybody’s thinking, and there’s a lot of effort that goes into it. But yes, ‘central banks’ is a key wild card to kind of think about.
Essentially prior to the Russia-Ukraine conflict central banks were adding on average 400 tonnes a year, and since that we have been seeing on average anywhere from 1 100-1 000 tonnes.
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Now, while we don’t necessarily expect – and we can’t expect – a thousand tonnes of central bank buying every single year since 2022, as long as we still see central bank demand, in our analysis we think an additional 20-30 tonne increase in reserves above or around the long-term average, it roughly means 600 tonnes per year, which translates roughly into another 1% increase in the gold price.
This is the way you can kind of think of every 20 to 30 tonnes. So a little long winded, but essentially we’re saying is, as long as we see 600 tonnes or more on the central bank side, we think that’s supportive for demand.
SIMON BROWN: A last question. Midterm elections in the US coming in November. Is there any sort of precedent or data in terms of potential impact?
TAYLOR BURNETTE: There’s no real strong signal when it comes to US elections, other than the fact that when you do have a Democrat administration running you typically tend to see gold buying pick up in the physical area; bar and coin demand tends to pick up. That’s really because in the US we tend to see more Republicans being gold buyers than Democrats.
That’s not to say that’s not the case everywhere, but you tend to kind of have Republicans lean more towards being open to buying gold when they start to see a Democrat administration going through.
Now, in this current situation, we’re looking like it’s going to be more depending on how things work. We have a split Congress, but we have a Republican in office. So far the data hasn’t shown any real signs of pickup.
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In fact, so far during Trump’s presidency we’ve seen limited bar and coin buying in recent weeks. But again, you tend to see that here in the US and that’s not the case obviously elsewhere. Again, it will be something to look at.
But one thing I will flag – aside from just ‘do midterms or do elections impact gold?’ – a split Congress also can add volatility. And so if things don’t get done, and if things aren’t getting passed, and there’s debates or things starting to deteriorate, or they trying to bring in power or wean in some of the power and direction that the administration’s going, that to a degree can be viewed as a potential geopolitical risk for volatility that we could see.
Well, we haven’t seen any evidence that it directly impacts physical demand buying – again, unless it’s during a Democrat administration or Democrat control. It could, though, still send signals throughout the market and things could change. And so it will be one of those things we’ll have to watch and see.
But again, it’s one of those wild cards where it may have an impact, but it may be a nothing-burger.
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SIMON BROWN: We’ll find out in November.
We’ll leave it there. Taylor Burnette, research lead Americas, World Gold Council, appreciate the time.
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