Gold market poised for further gains in 2026, but South Africa unlikely to fully benefit

Tawanda Karombo

Global markets are pricing in a continued rally in gold next year, although geopolitical uncertainty could inject volatility into bullion prices, according to the World Gold Council (WGC).

The rally in gold prices this year has provided South African bullion miners - among them Sibanye-Stillwater, Pan African Resources and Gold Fields - with prospects of bumping up revenues. However, for South African miners, a rise in costs has negated robust growth of production.

Data from the South Africa Reserve Bank showed the country’s net gold exports in the third quarter 2025 slowing down from R150 billion in the same period last year to R149bn.

Some South African gold producers are now planning production ramp ups which places them in position to benefit from the expected continued rally in gold prices in 2026.

Gold prices traded above $4 200 this week.

The WGC said on Thursday that “after setting more than 50 all-time highs and edging over 60% by the end of November, gold has emerged as one of the strongest performing assets” in 2025.

This year’s gold price rally is gearing up to be the precious metal’s fourth strongest annual return since 1971.

A combination of lower interest rates and a weaker dollar paired with heightened risk aversion helped to create a continued supportive environment for.

Analysts at WGC now believe that given the current environment, gold could rise 5% – 15% in 2026 from current levels.

“This would represent a solid return in a normal year, but following 2025’s strong performance, it would still be considered a noteworthy follow-up,” said the WGC analysts in their outlook for bullion prices.

“The combination of lower interest rates and a weaker dollar – both of which remain cyclically high – have historically been a source of support for gold.”

With geopolitical frictions continuing to simmer, gold’s outlook for 2026 is being defined by the uncertain economic environment that investors currently face. And, just like 2025, the upcoming year may also bring significant volatility across financial markets.

Nonetheless, WGC’s analysts noted that the forces of softer growth, accommodative policy, and persistent geopolitical risks are more likely to support gold than to undermine it.

Moreover, there is still further room for growth for gold investment, which has been critical to this year’s rally.

“This environment has resulted in a broader push for  portfolio diversification amid lacklustre bond returns and concerns of frothiness in equity markets. Against this backdrop and further supported by gold’s  positive momentum, investment demand has surged across all regions from West to East.”

Central banks have continued their gold buying, with demand well above average. Thus gold could see moderate gains in 2026.

And in a more severe downturn marked by rising global risks, gold could perform strongly.

Conversely though, a successful outcome from policies set by the Trump administration would accelerate economic growth and reduce geopolitical risk, leading to higher rates and a stronger US dollar, pushing gold lower in the New Year.

Yet South African investors are likely to largely miss out on the boon, with the country “no longer the world’s top gold producer, since most of the gold has been mined out after 150 year”s and what remains is kilometres deep and costly to extract, noted Old Mutual wealth investment strategist, Izak Odendaal.

Moreover, the mining climate in South Africa has become very difficult due to regulatory red tape, sky-high electricity prices, poor transport infrastructure and increasingly, illegal mining.

Furthermore, exploration activity has declined which means that output of gold will likely not increase any time soon.

Some solace though is that those with exposure to local and international gold stocks will likely be rewarded through dividends and increased profitability.

Odendaal also reckons that while the South African economy, financial market and exchange rate are less influenced by the gold price and mining in general than in the 1980s, the rise in the gold price is still significant, especially when platinum miners are taken into consideration.

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