Goldman Sachs Sees Gold Hitting $4,900 Amid Central Bank Buying Spree

Goldman Sachs has boosted its gold price target, pointing to the central bank buying spree. The bank's commodities team expects the metal to hit $4,900 per troy ounce by the end of the year, according to a research note.

Goldman Sachs projects more room to run for gold

The prediction points to a 3.65% increase from its current price. Lina Thomas, senior commodities analyst at Goldman Sachs Research, and Daan Struyven, co-head of Global Commodities Research, shared their view in a note to clients. 

"We continue to see elevated central bank gold accumulation as a multi-year trend, as central banks diversify their reserves to hedge geopolitical and financial risks, consistent with recent survey evidence," they wrote.

Central banks have relied on gold as a reserve asset since 2022, when G7 countries froze Russian central bank assets in Europe following the Ukraine war. That pushed many governments to reconsider how exposed their reserves are to foreign-currency freezes, and buying has stayed up ever since. 

Goldman projected that central banks would purchase an average of 50 tonnes per month in 2026, up about 300% from an average of 17 tonnes per month before 2022. Buying increased in June, reaching about 100 tonnes on a seasonally adjusted basis. It was also up from 66 tonnes the month before, with China's central bank said to be the largest single buyer.

Source: Goldman Sachs

Fed rate decision adds a second tailwind

The bank also pointed to the expectations around U.S. interest rates as a supporting factor. The metal tends to perform better when rates are steady or falling, since higher rates make yield-bearing assets like bonds more attractive by comparison. 

"We expect the Fed-related headwind to abate further, as our economists expect a lower inflation trend to keep the Fed on hold this year," the analysts wrote.

Demand for gold call options has also been climbing as investors look for ways to hedge against shifts in government policy.

Source: Goldman Sachs

In another development, market data firm Barchart noted that the metal has overtaken the U.S. dollar as the world's largest reserve asset. This is another sign of how central bank sentiment has changed in the past few years.

Gold has overtaken the U.S. Dollar as the largest Global Reserve Asset 🚨🚨🚨 pic.twitter.com/EJ0MCyJBr4

— Barchart (@Barchart) August 30, 2026

Even with the bullish outlook, it hasn’t exactly been all roses for gold. The metal traded around $4,440 an ounce on Monday after tumbling over 3% in the prior session, following hawkish comments from Fed Chair Kevin Warsh. 

However, Robin Brooks, a senior fellow at the Brookings Institution, wrote on X that the underlying trend still favors higher prices regardless of what the Fed does next. 

"If the Fed hikes in September, it'll only do so to anchor long-term yields, though obviously that won't be the stated reason. Yield caps among rising debt and out-of-control deficits are the bread and butter of the debasement trade. Gold will keep rising."