Goldman Sachs raised its gold price forecast for the end of 2025 to $3,100 per ounce, up from $2,890, citing continued demand from central banks.
The bank estimates that “structurally higher central bank demand will boost gold prices by 9% by year-end, coupled with a gradual buildup in exchange-traded fund holdings as funds rates decline.”
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However, if political uncertainty, including tariff concerns, remains elevated, Goldman expects gold to rise to $3,300 per ounce by year-end, according to Reuters.
The bank also revised its central bank demand forecast upward to 50 tonnes per month from a previous estimate of 41 tonnes. Goldman said that if purchases average 70 tons per month, gold prices could rise to $3,200 per ounce by the end of 2025.
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Conversely, if the Federal Reserve keeps interest rates steady, Goldman expects gold to reach $3,060 per ounce in the same period. Reiterating its recommendation to buy gold, Goldman Sachs said that while the decline in uncertainty could lead to a tactical decline in prices, long gold positions remain a strong hedge.
When analyzing data since 1916, the years were divided into two groups according to the average rate of tariffs. The average real return on gold over one, three and five years was then measured for each group. The results showed that gold tends to perform better when tariffs are low.
Gold price history since
But this relationship is not simple. Before the 1970s, gold was not freely traded due to the gold standard, which was finally abolished by US President Richard Nixon.
In addition, there have been limited periods of changing "tariff regimes" in American history, making it difficult to establish a clear causal relationship between tariffs and gold prices.
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