On Monday, February 17, Goldman Sachs raised its year-end gold price forecast for 2025 from $2,890 per ounce to $3,100 per ounce, citing continued central bank demand.
According to Reuters, Goldman Sachs estimates that “structural demand from central banks will drive a 9% increase in gold prices by the end of the year, coupled with an increase in ETF holdings as fund rates decline.”
Goldman Sachs added that if uncertainties decrease, it should offset the drag from investors’ normalization of positions.
However, if policy uncertainties including tariffs remain high, Goldman Sachs believes that due to long speculative positions, gold prices could potentially soar to $3,300 per ounce by the end of the year.
The bank also revised its central bank demand assumption from 41 tons per month to 50 tons per month. Goldman Sachs stated that if the average monthly gold purchase is 70 tons and assuming positions normalize, gold prices could rise to $3,200 per ounce by the end of 2025.
On the other hand, if the Federal Reserve maintains stable rates, the bank expects gold prices to reach $3,060 per ounce during the same period.
Goldman Sachs reiterated its recommendation to “buy gold,” stating that despite a potential tactical price drop as uncertainties decline, long gold positions remain a powerful hedge tool.
The bank emphasized that buying gold is particularly important in the face of potential trade tensions, Fed-related risks, and financial or recession threats, which could push gold prices towards the upper limit of Goldman’s high uncertainty range.
Furthermore, if concerns about U.S. fiscal sustainability escalate, Goldman Sachs expects gold prices to rise by 5% to $3,250 per ounce by December 2025.
The investment bank added that increased worries about inflation and fiscal risks could lead to an increase in speculative positions and ETF flows, while concerns about U.S. debt sustainability could encourage central banks, especially those with substantial reserves of U.S. Treasury bonds, to increase their gold purchases.
(This article is for general informational purposes only and is not intended as a recommendation. The Epoch Times does not provide investment, tax, legal, financial planning, real estate planning, or other personal finance advice. For specific investment matters, please consult your financial advisor. The Epoch Times does not assume any investment responsibility.)