Goldman Sachs lifts 2026-end gold price forecast to $5,400; here’s why

Goldman Sachs has revised its year-end 2026 gold price projection upwards, increasing the forecast to $5,400 per ounce from the previous $4,900/oz. 

This adjustment is attributed to the ongoing trend of private-sector and emerging market central banks diversifying their reserves into gold.

Gold prices on COMEX had hit a fresh record high of $4,890 per ounce on Wednesday due to increasing safe-haven demand amid ongoing geopolitical tensions around the world. 

Central bank purchases and ETFs

The safe-haven metal's rally has been blistering, with a 70% surge last year. This momentum has continued into 2026, with the metal climbing over 11% so far in 2026.

"We assume private sector diversification buyers, whose purchases hedge global policy risks and have driven the upside surprise to our price forecast, don't liquidate their gold holdings in 2026, effectively lifting the starting point of our price forecast," the brokerage was quoted as saying in a Reuters report.

Additionally, western ETF holdings are projected to increase, according to Goldman Sachs, a rise they attribute to the likelihood of the US Federal Reserve implementing a 50-basis-point cut to the funds rate in 2026.

Emerging market central banks are anticipated to continue diversifying their reserves into gold, leading Goldman Sachs to project an average central bank buying of 60 tonnes in 2026.

Goldman Sachs suggests that gold prices could face a downside risk if a significant decrease in perceived risks regarding the long-term direction of global monetary policy prompts the liquidation of macro policy hedges.

Citing increased safe-haven demand, Commerzbank AG also raised its gold price forecast last week to $4,900 by year-end.

Gold slips on Thursday

The price of gold retreated from its record high of $4,890 to trade near $4,790 during the early Asian session on Thursday, trimming earlier gains. 

This pullback followed US President Donald Trump's decision to withdraw the European tariff threat and the announcement of a framework agreement regarding Greenland.

On Wednesday, Bloomberg reported that Trump would not impose tariffs on goods from European countries that opposed his attempt to acquire Greenland.

A future deal concerning Greenland, with a framework established by the US and the North Atlantic Treaty Organization (NATO), was also mentioned by Trump.

“Hopes for a solution in Trump’s ambitions for Greenland that would avoid tariffs could undermine traditional safe-haven assets such as Gold in the near term,” Lallalit Srijandorn, editor at FXStreet, said in a report. 

Trump did not, however, elaborate on the specifics of the alleged "framework," leaving the exact nature of the agreement ambiguous. 

Following Trump's retraction of threats to use tariffs as leverage to acquire Greenland, German Finance Minister Lars Klingbeil cautioned against undue optimism. 

Bull market remains strong

Any indication of heightened tensions between the US and the EU could potentially drive up the price of the yellow metal.

Although gold's price movement may currently be slowing, the bull market remains strong, according to Ewa Manthey, commodities strategist at ING Group. 

Manthey noted that expectations of interest rate cuts, ongoing geopolitical instability, and robust central-bank purchases all contribute to a firm upside risk for the commodity.

Meanwhile, investor concerns regarding the independence of the central bank were heightened by the Trump administration's repeated criticisms of the Federal Reserve. This volatility, in turn, strengthened the "debasement trade."

Manthey added: 

Key US economic data expected later on Thursday, which traders are anticipating, includes the final third-quarter GDP reading, the weekly initial jobless claims, and the personal consumption expenditures (PCE) price index.