According to a report by Reuters, Goldman noted that risks to this upgraded forecast remain skewed to the upside. The bank cited private sector diversification into the relatively small gold market as a potential catalyst for boosting ETF holdings beyond its rates-implied estimates.
“We see the risks to our upgraded gold price forecast as still skewed to the upside on net,” Goldman said.
As of early Tuesday trading, spot gold was priced around $3,960 per ounce, having touched an intraday high of $3,977.19. Year-to-date, gold has rallied 51%, supported by a range of factors including sustained central bank buying, increased demand from ETFs, geopolitical tensions, and a weaker U.S. dollar.
Goldman expects central banks to continue diversifying their reserves into gold, estimating average annual purchases of 80 metric tons in 2025 and 70 tons in 2026. The bank added that emerging market central banks, in particular, are likely to play a key role in this structural shift.
Additionally, expectations of U.S. interest rate cuts are also contributing to the bullish sentiment. Goldman analysts project that the U.S. Federal Reserve may lower the funds rate by 100 basis points by mid-2026, which could further enhance the appeal of non-yielding assets like gold.In a related market commentary, Rahul Kalantri, VP Commodities at Mehta Equities, highlighted that gold and silver have both hit fresh all-time highs. Gold prices are moving closer to the $4,000 per troy ounce mark in international markets.He cited strong ETF investment demand as a critical factor supporting the rally, with gold ETF holdings up 17% so far this year.
Kalantri added that political turbulence in France and Japan, along with economic concerns in the U.S., have further contributed to safe-haven buying.
Kalantri pegged support for Indian markets at Rs 1,19,600–Rs 1,19,280 range and resistance at Rs 1,20,850–Rs 1,21,400.
According to Goldman Sachs, current ETF strength is not an overshoot. Instead, it reflects strong demand fundamentals, with speculative positioning remaining broadly stable even after a significant increase in September.
Also read: After a 50% rally, how much higher can gold and silver go this Diwali?
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