Goldman Sachs Keeps Bullish View on Gold Despite Rate Hikes

Goldman Sachs has maintained its bullish view on gold prices for 2027, despite recent Federal Reserve rate hikes. Analyst Lina Thomas said that while higher rates will continue to weigh on gold through exchange-traded fund demand in the near term, the Fed is likely to cut interest rates three times between September 2027 and March 2028.

This would leave the terminal rate unchanged, according to Goldman Sachs. As a result, Thomas expects the impact of tighter monetary policy to be felt primarily through a slower near-term appreciation path rather than a lower terminal gold price.

The bank trimmed its year-end fair value estimate for gold to $4,650 an ounce from $4,900, but still sees this as above the recent spot price of about $4,350. Central bank buying remains the main structural driver of gold prices, contributing nearly all of Goldman's expected 23% appreciation through end-2027.

Purchases are running at about 91 tonnes a month, well above the pre-2022 average of 17 tonnes. Thomas noted that risks remain skewed to the upside, with resilient call-option demand for gold as a macro-policy hedge, but flagged greater two-sided volatility.