Gold to rise near $6,500/oz in 2026 as bull case strengthens, silver’s market balance suggests caution for investors – BMO’s Amos
The myriad geopolitical flashpoints of January have caused a reassessment and a reorientation of gold’s trajectory from base to bull case, while the loosening of the silver market after the recent speculative excesses is reason to stay away, according to Helen Amos, managing director and commodities analyst at BMO Equity Research.
In a recent interview with BNN Bloomberg, Amos was asked what she’s telling colleagues and clients about gold these days.
“There's still a lot of excitement over the space,” she said. “I know we've had a lot of volatility as well, but fundamentally investors still like metals and mining. We're telling investors to stay in the space, stay in gold and copper; they’re our top picks for commodities this year.”
“There's just so many drivers all layering up together,” she added. “You've got emerging market momentum, you've got this deglobalization theme you've got de-dollarization that’s particularly benefiting the precious metals. Mm-hmm. And then, of course, you've got strong retail and investment interest as well, which looks pretty secure – every time we've had a bit of a pullback in gold, it's found a really nice, solid base, very soon.”
Amos also elaborated on BMO’s bull case for gold, which sees the yellow metal reaching close to $6,500 by year-end, and then rising to $8,600 per ounce by the end of 2027.
“We've got a regression model that we run for gold,” she said. “It's becoming increasingly difficult to keep up with gold's moves, but what we find is that we can still broadly explain its performance based on central bank demand, ETF flows, the US dollar index, and 10-year TIPS yields.”
“What we said is, imagine if for the next couple of years, we see the same pace of investment demand as we saw in the first year of Trump's second term,” Amos said explained. “So we ran a similar or slightly higher rate of central bank purchases through, the pace of ETF flows, and that's what brought us to almost $6,500 by the end of this year. It just shows you how easy it is to get to these higher prices.”
BMO’s base case sees gold prices declining over the next few months, but Amos pointed out that this case was calculated in December, and a lot has happened since. “In January we just had a huge number of geopolitical flashpoints,” she said. “We had Venezuela, we had Greenland, we had concerns over Fed independence, all happening at once. In the course of those few weeks that we published our base case, the risks are definitely now skewed to the upside, towards our bull case.”
Asked about silver, Amos said BMO isn’t too comfortable with the gray metal given where the gold:silver ratio currently sits.
“We're a little bit wary on silver now,” she said. “It’s mainly an industrial commodity still in our eyes. We've got the physical market balance, it actually is probably starting to loosen now. We think we've passed the peak for global solar installations. And I do think retail investors got a bit carried away over December and January, probably on the debasement theme. We had a lot of speculative activity and a lot of options trading as well that pushed [prices] up. It's come back down to earth. All of that volatility that we had didn't do silver any favors in terms of its reputation as a safe haven asset.”
“We are keeping an eye on any changes that might affect its status as an investment or safe haven asset, the situation is obviously quite fluid,” she added. “But for now, the physical market balance looks like we're through the worst of that.”
