BMO Lowers Gold Price Forecast as Fed Turns More Hawkish

BMO Capital Markets has trimmed its gold price outlook, now projecting an average of $4,625 per ounce for the second half of the year, down 5 percent from prior estimates, due to the Federal Reserve’s more hawkish stance. Analysts noted potential recovery if lower oil prices sustain emerging-market demand, while maintaining a view for prices to exceed $5,000 in the first quarter of 2027. The bank also cut its near-term silver forecast to $69 an ounce in the third quarter and $71 in the fourth, with a peak near $74.80 expected in the second quarter of 2027, supported by industrial demand from power and electrification projects. U.S. monetary policy remains the key near-term risk as markets price in possible rate hikes by year-end. Gold continues to gain from de-dollarization trends driven by geopolitical sanctions and sovereign debt concerns. The Fed kept rates steady but signaled at least one hike this year amid higher energy prices and inflation worries.