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Analysts Lina Thomas and Daan Struyven now expect gold to reach $2,910 an ounce by year-end. They attribute this adjustment to weaker bullion-backed ETF demand, driven by reduced market uncertainty post the US election.
“Lower speculative demand and higher central bank buying have offset each other, keeping gold prices range-bound,” they wrote in a note.
The analysts project central bank purchases to average 38 tons per month through mid-2026. Central banks’ continued appetite for gold will remain a key driver for prices in the long term, the Bloomberg report said.
Gold soared 27% last year, fueled by monetary easing, safe-haven demand, and robust central bank buying. However, the rally stalled in November as the dollar strengthened after the US election.
Recent pressure on gold prices comes as the Fed signals a cautious stance on reducing borrowing costs amid inflation concerns.
Goldman has also revised its rate-cut outlook, now expecting 75 basis points of cuts in 2024, down from 100 basis points.
The bank anticipates underlying inflation to trend lower, aligning its forecast with dovish market expectations.
Meanwhile, gold prices inched higher on Monday (January 6), supported by a softer dollar, while investors awaited a slew of US economic data including the December nonfarm payrolls report for further guidance on the Federal Reserve’s interest rate stance.
Spot gold rose 0.2% to $2,643.69 per ounce by 0229 GMT.
US gold futures climbed 0.1% to $2,656.80 per ounce.
