Gold bulls are getting a reminder that geopolitical turmoil doesn’t always send bullion higher.
Sometimes the inflation and interest-rate consequences overwhelm the safe-haven bid and sometimes the point of accumulating gold reserves is to use them when a shock — like a war — hits
That’s the challenge running through CIBC’s latest precious metals outlook. The bank has sharply lowered its forecasts as higher energy prices, a stronger US dollar and a more hawkish Federal Reserve complicate the trade. But it still sees a substantial recovery over the next two years.
In its October report, CIBC cuts its 2027 average gold forecast to US$5,200 an ounce from $6,500. Its 2028 estimate falls to $5,500 from $6,000, while the fourth-quarter 2026 forecast drops to $4,500 from $6,500. Those are sizeable revisions but still leave CIBC comfortably above the consensus estimates included in the report: $4,620 for 2027 and $4,451 for 2028. “Despite this monetary policy headwind, we believe elevated geopolitical risk, fiscal concerns and continued diversification away from US Treasuries will underpin gold demand and support a recovery through 2027 and 2028,” CIBC writes.