Goldman Sachs Maintains Gold Price Forecast of $5,400 by 2027

Goldman Sachs has maintained its long-term bullish outlook on gold prices despite the Federal Reserve's interest rate hikes, stating that gold prices will reach $5,400 per ounce by the end of 2027. In the short term, the rate hikes may pressure demand for gold exchange-traded funds (ETFs), but it is analyzed that central bank demand for gold will offset this. Central banks are purchasing an average of about 91 tons of gold per month, significantly exceeding the pre-2022 average of 17 tons. Goldman Sachs explained that this buying momentum is a key driver of rising gold prices. Additionally, demand for gold call options is supporting gold price increases as a macroeconomic hedge, with current open interest in GLD call options at about 2.3 million contracts, approximately three times the historical average. Goldman Sachs has lowered its estimate of gold's fair value at the end of 2026 to $4,650 per ounce, but this is still above the current spot price of about $4,350. Furthermore, it expects the Fed to implement three interest rate cuts between September 2027 and March 2028.

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