The bank revised its year-end gold target downward amid persistent inflation and higher-for-longer interest rates.
Goldman Sachs reduced its year-end gold price target by $500, citing delayed rate cuts and sustained inflation pressures. The adjustment reflects concerns over gold’s yield disadvantage relative to bonds and cash as rates remain elevated.
Earlier this year, gold hit record highs on expectations of monetary easing, but May’s 4.2% annual CPI increase and Middle East tensions have clouded the outlook. Markets now price in a higher probability of rates staying flat or rising through 2026, currently at 3.5%-3.75%.
Analysts noted that liquidity improvements and lower capital costs are needed to revive risk appetite and support gold prices.