Goldman Sachs Slashes Gold Price Forecast by $500 on Fed Rate Stance
By Aboki Forex —
Goldman Sachs has cut its year-end gold forecast by $500 per ounce. The bank now sees gold at $4,900 an ounce by December. The revision comes as the Federal Reserve is no longer expected to cut interest rates in 2026.
Analysts Lina Thomas and Daan Struyven said in a note that the bank remains structurally constructive on gold but is now tactically cautious. They pointed to near-term downside risk and medium-term upside potential.
Goldman Sachs has been one of the most bullish voices on gold in recent years. In late 2024, the bank told investors to 'go for gold' and correctly predicted a major rally.
Gold has struggled in recent months. The war in the Middle East pushed energy prices higher, which boosted expectations for tighter monetary policy. This week, the Federal Reserve held rates steady but signaled growing support for rate hikes. New Fed Chairman Kevin Warsh also vowed to restore price stability.
The cut to the gold outlook was driven by lower expected inflows into gold-backed exchange-traded funds. Goldman's economists now see US rate cuts coming in June and December of next year. Earlier forecasts had cuts in December 2026 and March 2027.