State Street’s Baseline Scenario Sees Gold Reaching $5,500/oz by Q1 2027

Despite tactical headwinds such as elevated yields and a strong dollar, structural factors including Asian and central bank demand should push gold higher. State Street Global Advisors’ baseline scenario sees prices reaching as high as $5,500 per ounce by March 2027. In June spot gold dropped 11.7% while testing $4,000 support, with gold ETF outflows totaling around $5.3 billion. Markets now price in roughly 1.5 Fed rate hikes this year, lifting real yields and sending U.S. money-market funds to a record $7.9 trillion. Global debt hit an all-time high of $353 trillion, with the government share nearing one-third. Elevated stock-bond correlations and robust physical demand from Chinese retail investors and emerging-market central banks reinforce gold’s role as a hedge. Its weighting in managed funds remains below 1%, well under the recommended 3-10% allocation.