Goldman Sachs: Cutting its gold price forecasts for 2026 and 2027; central-bank buying still supports long-term gains

By how much did Goldman Sachs lower its gold price forecasts?

Goldman Sachs lowered its forecast for the gold price at the end of 2026 from 4650 dollars to 4150 dollars per troy ounce, and its forecast for the end of 2027 from 5400 dollars to 4800 dollars. The reason is that the Fed has turned more hawkish in recent months, putting pressure on investor positions.
The bank says the current environment increasingly resembles 2022: central banks provide steady buying, while higher interest rates weigh on investor positions. With both forces at work, gold can still rise, but at a more moderate pace.

Goldman Sachs expects central banks to buy 60 tonnes of gold per month in 2026–2027, above the average of 17 tonnes per month before 2022; its current real-time estimate of the seasonally adjusted three-month average is 85 tonnes per month.
The bank believes that gold allocations by central banks in emerging markets, including China, remain relatively low compared with potential long-term levels, and that the incentive to diversify away from risks associated with Group of Seven reserve currencies remains. Central-bank demand accounts for most of the roughly 15% rise in gold prices it forecasts by the end of 2027.

Goldman Sachs’s baseline scenario assumes the Fed raises rates in December 2026, curbing concerns about currency debasement and allowing demand for gold as a macro-policy hedge to gradually return to around its historical average.
Goldman Sachs economists expect the Fed to cut rates three times between the end of 2027 and the beginning of 2028. As the constraint from interest rates eases, inflows into interest-rate-sensitive Western gold ETFs could join central-bank buying in pushing gold prices higher.
If the Fed raises rates again in March 2027 and the terminal rate is higher, Goldman Sachs estimates the gold price at the end of 2027 will be 4660 dollars per troy ounce, below its baseline forecast of 4800 dollars.

Goldman Sachs estimates that under normal conditions, every additional 100 tonnes of net demand from Western ETF holdings, net managed-money positions and central-bank purchases raises the gold price by about 2%; every additional 1 million contracts in GLD call options’ net open interest relative to put options raises it by about 5%.
To hedge their risk, options sellers may buy gold as its price approaches the strike price, amplifying a rally as prices rise; when gold prices fall, unwinding hedge positions may also deepen the decline. Because the history of high options demand is relatively short and the size of its effect is uncertain, Goldman Sachs has not included this amplification effect in its baseline forecast.
Over the next 3–6 months, Goldman Sachs believes high interest rates and volatility in inflation and employment data will make short-term bullish positions more difficult. Higher oil prices could trigger systematic selling, while a sharp stock-market decline could initially weigh on gold through margin calls and deleveraging.