Gold and Silver Price Forecast: ETF Inflows Surge as Warsh and PCE Loom

Key Points

• Gold-backed ETFs attracted nearly 47 tonnes, indicating a significant rebound in institutional investment demand.
• Fed Chair Kevin Warsh's upcoming speech and PCE inflation data are critical monetary-policy catalysts for gold prices.
• Expanded U.S. sanctions on Iran and ongoing regional tensions provide additional geopolitical support for precious metals.

Market Overview

As of August 25, the fundamentals for gold and silver are influenced by three main factors: increased investment demand, uncertainty regarding Federal Reserve policy, and renewed geopolitical tensions, particularly concerning Iran. Last week, gold-backed ETFs saw inflows of nearly 47 tonnes, equivalent to around $6.4 billion, marking the largest weekly inflow in about ten months. This surge in demand from institutional investors persists despite high long-term U.S. Treasury yields.

Market participants are closely monitoring Fed Chair Kevin Warsh’s speech at Jackson Hole and the upcoming U.S. PCE inflation data. Currently, there is a 42% probability of a rate hike in September, which keeps expectations for Fed policy in a state of flux. A lower-than-expected PCE inflation print or a less hawkish stance from Warsh could make non-yielding metals like gold and silver more attractive. Conversely, tighter Fed policy expectations could increase the holding costs for these metals.

Geopolitical Factors

Geopolitical tensions are also supportive of gold and silver prices. The U.S. has expanded sanctions on Iran's digital assets, technology, gold, aviation, and shipping sectors, threatening to sanction any entity that continues to engage with Iran. Iran has vowed to resist these sanctions, heightening the risk of further regional disruptions.

Silver Market Dynamics

The Silver Institute projects that the silver market will remain in a deficit for the sixth consecutive year in 2026, driven by increased demand from electronics and AI-supported infrastructure, although demand for solar applications may decline due to technological advancements and subsidies in alternative technologies.

Technical Analysis

Gold (XAU/USD)

Gold is currently holding above $4,619, with a bullish structure intact as it remains above the 50-EMA at $4,569 and the 100-EMA at $4,493. The price has pulled back to the upper boundary of a rising channel at $4,633. A rejection at $4,696 could indicate a return of bearish pressure, but buyers are likely to defend the higher-low structure.

The RSI is at 55, indicating a neutral momentum shift. Support levels are at $4,619, $4,567, $4,508, and $4,448, while resistance levels are at $4,696, $4,756, and $4,812. A bullish trend is expected as long as gold holds above $4,619.

Silver (XAG/USD)

Silver is currently priced at $67.96, having retreated from the $69.90 resistance zone. It remains within a broader uptrending channel, with the price testing the midline and the 50-EMA at $67.89. The bullish structure is still intact, although momentum has slightly favored sellers, with the RSI at 45.

Support levels are at $67.28, $65.68, $64.15, and $62.55, while resistance is at $68.49, $69.90, $71.03, and $72.39. Silver is expected to remain bullish as long as it trades above $67.28, with potential targets at $69.90 if $68.49 is surpassed.