Fearless of sell-offs! Goldman Sachs remains bullish on gold: medium-term outlook is solid, with a potential price of $5,400 by the end of the year

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Source: Caixin (Cailian News)

Despite recent gold selloffs, Goldman Sachs Group has maintained its bullish view on the precious metal and expects the gold price to return to an uptrend by the end of 2026.

In a recent research report, Goldman analysts Lina Thomas and Daan Struyven said that supported by central banks in various countries continuing to purchase gold and the U.S. Federal Reserve expected to cut rates another two times this year, the medium-term outlook for gold remains solid, with the gold price expected to rise to $5,400 per ounce by year-end.

They said that in the short term, gold still faces “tactical downside risk.” If energy supply shocks intensify, the gold price could further fall to $3,800 per ounce. However, if the Iran war drives investors to accelerate diversification from “traditional Western assets,” the upside potential for gold remains significant.

Since the outbreak of the Iran-U.S. war a month ago, gold has fallen by 13%. Recently, weakness in the stock market has forced gold investors to unwind positions, and the market has also started to factor in tighter monetary policy.

But Goldman analysts said this repricing has already been “overdone,” reflecting that, compared with economic growth dragging on, the market is overemphasizing inflation, adding that history shows concerns about growth will ultimately take the lead.

Goldman economists still hold to their forecast that the Federal Reserve will cut rates twice in 2026. The firm recently pushed back its expectation for the first rate cut by the Federal Reserve from June to September, and expects the central bank to deliver the second rate cut in December this year.

The analysts also noted that concerns that some central banks are selling gold to support their currencies are unlikely to come true. Gulf countries generally adopt a dollar-pegged exchange-rate mechanism; if they need to intervene in the market, they are more likely to reduce holdings of U.S. Treasuries.

Meanwhile, central bank demand remains a key support for medium-term demand. Goldman expects central bank gold purchases may accelerate again, averaging about 60 tons of gold per month.

Federal Reserve Chair Jerome Powell said on Monday that, against the backdrop of energy shocks triggered by the U.S.-Iran war, the Fed is inclined to keep interest rates unchanged and for the time being “ignore” the impact of this shock.

With Powell reviving bets on rate cuts, international gold prices continued to rise on Tuesday. As of the time of publication, the gold price is approaching $4,600 per ounce, far below the nearly $5,600 peak it hit at the end of January.

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责任编辑：朱赫楠