Goldman Sachs maintains its optimistic outlook for gold, projecting the price will reach $5,400 per ounce by the end of the year. Central bank diversification continues to be a key supporting factor, with demand from official institutions remaining robust despite several rounds of market volatility.
The firm also anticipates a normalization in speculative positioning and expects the Federal Reserve to cut interest rates by approximately 50 basis points, which would reduce the opportunity cost of holding gold.
In the short term, Goldman Sachs notes that risks are tilted to the downside, particularly if geopolitical tensions trigger further liquidation. However, over the medium term, geopolitical uncertainty and concerns over fiscal sustainability may accelerate global diversification into gold, thereby reinforcing its long-term upward trend.
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