Societe Generale forecasts gold hitting $5,000 by mid-2027

Societe Generale has projected gold prices will hit $5,000 an ounce by the second quarter of 2027, citing rebounding central bank purchases and renewed ETF demand as the primary drivers of a continued rally in the precious metal.see

The French bank forecasts gold averaging $4,500 an ounce in 2026 and $5,125 in 2027, with prices reaching $4,750 in the fourth quarter of this year before climbing to $5,250 during the third quarter of next year. The outlook comes as gold trades near $4,380, well below its January record high above $5,500 but supported by what the bank describes as structural demand.discoveryalert+2

Central Banks and the Reserve Shift

Societe Generale's forecast rests on what it calls a revival of the "debasement trade," in which geopolitical fragmentation and concerns over U.S. fiscal credibility are pushing central banks to accumulate gold while reducing exposure to U.S. Treasuries. Central banks purchased a record 289 tonnes during the second quarter of 2026, according to industry data.see+1

The trend received formal recognition in June when the European Central Bank confirmed that gold had overtaken U.S. Treasuries as the world's top reserve asset, accounting for 27% of global central bank reserves at the end of 2025, up from 20% a year earlier. U.S. Treasuries fell to 22% over the same period.wsj+1

Global gold ETF holdings have returned toward 3,000 tonnes, which Societe Generale views as evidence of rebuilding institutional demand. The bank also expects real interest rates to decline later in the monetary cycle, reducing the opportunity cost of holding gold, while a softer dollar provides additional tailwinds.see

A Crowded Bullish Consensus

Societe Generale is far from alone. UBS ↘ 2.03% forecast in August that gold would reach $5,000 in the first half of 2027, while RBC Capital Markets said in early September that gold should approach $5,000 by year-end 2026 and $5,300 in 2027, driven by "uncertainty, de-dollarization, and debasement concern". J.P. Morgan JPMorgan Chase & Co. ↘ 0.84% holds a substantially more aggressive view, forecasting $6,000 by the fourth quarter of 2026.reuters+2

Societe Generale noted that even with bond yields near 5%, gold's appeal persists because higher borrowing costs themselves reflect concerns over governments' ability to manage debt burdens. The Congressional Budget Office expects the U.S. budget deficit to remain above 6% of GDP, while net interest outlays are projected to approach 5% of GDP by the mid-2030s.see

The bank has adjusted its model portfolio accordingly, maintaining a 10% allocation to gold and proposing a shift from the traditional 60/40 equity-bond split to a 60/20/20 mix of equities, bonds, and commodities.see