Gold Falls Below $4,300, TD Securities and BMO Expect It to Exceed $5,000 by 2027

On September 24, the price of gold fell below $4,300 per ounce, pressured by a stronger dollar, rising U.S. Treasury yields, and the Federal Reserve's resumption of interest rate hikes. Both TD Securities and BMO Capital Markets believe that the medium- to long-term demand for gold remains resilient, predicting that gold prices will surpass $5,000 again by 2027. Ryan McKay, a senior commodity strategist at TD Securities, stated that the negative correlation between gold and real interest rates is weakening, and geopolitical risks, de-dollarization, concerns about fiscal sustainability, and currency depreciation risks may continue to support gold demand. TD Securities estimates that since July, global gold ETFs have accumulated an increase of about 6.3 million ounces, with central banks purchasing nearly 70 tons of gold per month on a three-month moving average basis, suggesting that if investment demand continues to recover, there is still room for further capital absorption in the gold market. BMO noted that global physical gold demand is improving, with support from India's wedding season, China's gold imports, and ETF inflows. In the past week, global gold ETFs attracted about $4.2 billion in inflows; China's net imports of non-monetary gold in August increased by 48% year-on-year to 124.5 tons. BMO believes that gold can maintain a range of $4,300 to $4,400 even as the dollar and 10-year U.S. Treasury yields rise simultaneously, and expects gold prices to exceed $5,000 again in the first quarter of 2027, but short-term attention should be paid to U.S.-China talks and U.S. core PCE inflation data.

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