LONDON — Physical gold investment is on track to overtake jewelry as the primary driver of global demand this year for the first time on record, according to an annual report released Thursday by Metals Focus, a London-based precious metals consultancy widely cited by industry analysts and financial media.

The shift follows a 19% decline in jewelry demand last year as consumers contended with record-high prices and geopolitical uncertainty. According to Reuters, research consultancy Metals Focus expects double-digit losses for the jewelry sector to continue throughout 2026.

Gold reached an all-time high of $5,595 per troy ounce in January. While prices have since retreated 20% from that peak, Metals Focus anticipates a second-half rally, forecasting an average price of $4,920 per ounce for the full year — a 43% increase over 2025.

Retail investors are increasingly turning from ornamentation toward bars and coins. Physical investment is expected to rise 15% this year to its highest level since 2013, with China leading the growth. Central bank demand, meanwhile, is projected to fall as some nations sell gold reserves to stabilize local currencies amid rising energy costs and inflationary pressures.