Goldman Sachs sees the price of gold reaching as high as $4,900 per ounce by December 2026, raising its forecast from the previous $4,300 per ounce.
It cited strong demand of Western exchange-traded fund (ETF) inflows and buying by central banks.
“We see the risks to our upgraded gold price forecast as still skewed to the upside on net, because private sector diversification into the relatively small gold market may boost ETF holdings above our rates-implied estimate,” Goldman Sachs said.
With news of the revised upward forecast breaking out, spot gold was being traded at around $3,960 per ounce on 0130 GMT on Tuesday (October 7). It nearly reached $4,000 per once earlier.
Goldman Sachs expects central banks buying an average of 80 metric tons (MT) this year and 70 MT in 2026, as central banks in emerging economies are likely to continue diversifying their reserves with a bias on gold.
Furthermore, Western ETF holdings are forecast to increase as the US Federal Reserve is seen reducing policy rates, according to Goldman Sachs.
So far, the price of gold has climbed by at least 50 percent this year as central banks ramped up their purchases of the commodity.
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