Gold Surges Above $4,600 on Central Bank Buying and Geopolitical Uncertainty

Gold has broken above $4,600 an ounce, extending its powerful rally that's been supported by central-bank purchases, shifting expectations for US interest rates, and heightened geopolitical uncertainty. Goldman Sachs expects this momentum to continue, forecasting gold could reach $4,900 an ounce by the end of 2026.

Central banks are increasingly treating gold as a strategic reserve asset rather than just an inflation hedge or traditional safe-haven asset. Official-sector buying has become one of the strongest pillars supporting gold prices, with Goldman Sachs estimating central banks could buy an average of 50 tonnes of gold a month in 2026, well above the pre-2022 monthly average of around 17 tonnes.

The shift accelerated after Western governments froze Russia's foreign-exchange reserves following the invasion of Ukraine. This highlighted the risk that conventional reserve assets can be restricted or frozen by foreign governments, making gold an attractive option for diversifying reserves without relying on another country's currency or financial infrastructure.