Gold price has fallen – what this means for you | Personal Finance | Finance
The gold price has tumbled prompting investment experts to ask whether now could be a good time to invest in it at a reduced price.
The precious metal enjoyed an extraordinary start to 2026 surging to an all-time high of almost $5,600 (£4,150) an ounce in January, but has since slipped to around $4,000 (£2,987).
Experts say the pullback may tempt investors, but warn against expecting another quickfire price surge. For most people, gold works best as a small part of a balanced portfolio rather than a bet on quick profits.
It can be bought as coins or bullion, but many investors prefer an exchange-traded fund (ETF) investing in gold, which can be purchased inside a Stocks and Shares ISA. This tracks the price without the cost or security issues of storing physical gold.
One big disadvantage of gold is that it doesn’t pay any interest or income. That’s one of the main reasons its price has fallen lately.
As inflation rises again due to the Iran war, investors expect interest rates to climb too. This will boost returns from cash and bonds, making gold look less attractive by comparison.
Tony Redondo, founder at Cosmos Currency Exchange, said gold is still worth considering given today’s lower price. “The long-term bull case remains intact, despite the aggressive 27% fall from January’s high of $5,595.”
He said global central banks continue to buy large amounts of the metal as they diversify away from the US dollar, supporting demand. “Major institutions are forecasting a gold recovery, with UBS targeting $5,500 and Goldman Sachs $4,900 by the end of the year. However, the price might be choppy.”
Financial advisers typically suggest putting no more than 5% or 10% of your total investments into gold.
Paul Denley, chief executive at Oakham Wealth Management, said: “Gold’s strongest role in a portfolio is as a diversifier. At current levels, I’d favour buying gradually rather than trying to call the bottom, and owning gold for the protection it can provide, not simply because it used to be more expensive.”
