Goldman Sachs' Year-End 2026 Forecast of $4,900 for Spot Gold

Goldman Sachs has projected that spot gold could climb to $4,900 by the end of 2026, driven by sustained strong purchases by central banks and weakening expectations of a Federal Reserve rate hike.

Expected Year-End Target

Goldman Sachs projected that spot gold could rise by the end of the year as central banks maintain their strong purchases and expectations for a Fed rate hike in 2026 weaken.

Having gained about 15 percent since its mid-July low to rise to around $4,600, gold's monthly central bank purchases are expected to average 50 tons in 2026.

Central Bank Reserve Diversification

Goldman Sachs Research Senior Commodities Analyst Lina Thomas and Co-Head of Global Commodities Research Daan Struyven stated that the trend of reserve diversification is decisive for gold prices.

Compared to assets held in foreign currencies, gold, which is seen as having a more limited freezing risk, continues to stand out in central banks' reserve diversification preferences.

Impact of Interest Rate Expectations on Gold Demand

With forecasts of a Fed rate hike in 2026 receding in the markets, a recovery was seen in gold demand from investor groups that had performed weakly in the first half of the year.

It is anticipated that a lower inflation trend will prompt the Fed to keep its policy rate steady this year, reducing pressure originating from the Fed.

Derivatives Market and Volatility Risks

It was reported that investors' interest in gold call options has increased in order to protect their portfolios against potential changes in public policies.

Analysts pointed out that this situation could make upward and downward movements in gold prices sharper and increase two-way volatility in the market.