Gold Is Up Nearly 30% In The Last Year, But Goldman Sachs Sees More Room To Run

• Goldman Sachs has cited growing demand from central banks as they continue to diversify their reserves, and markets scaling back expectations for U.S. rate hikes in 2026 as reasons for the target. 
• The firm expects central banks to purchase an average of 50 tonnes of gold per month in 2026, up from an average of 17 tonnes per month before 2022.
• Meanwhile, Barchart said in a post on X that gold has also recently overtaken the U.S. Dollar as the largest global reserve asset. 

Gold prices have surged nearly 30% in the last year, according to data from TradingView. Yet Goldman Sachs has recently raised its target for the precious metal.

According to a report released over the weekend, the analyst sees gold rising to $4,900 per troy ounce by the end of 2026, an increase of about 3.65% from current levels. 

Gold Prices To Rise Amid Central Bank Demand, Hedging Utility 

Goldman Sachs has cited growing demand from central banks as they continue to diversify their reserves, and markets scaling back expectations for U.S. rate hikes in 2026 as reasons for the target. 

“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,” Goldman’s analysts wrote in a note. 

Goldman Sachs expects central banks to purchase an average of 50 tonnes of gold per month in 2026, up from an average of 17 tonnes per month before 2022.

The analyst also noted that the demand for gold call options is rising as investors turn to the precious metal instrument to hedge their portfolios against large-scale changes in government policies.

“Gold’s share in private portfolios remains low, and recent geopolitical developments—including Iran and broader tensions—may accelerate diversification beyond central banks to private investors, including by weighing on perceptions of Western fiscal sustainability,” the analyst said. 

Gold As Largest Global Reserve Asset

Meanwhile, Barchart said in a post on X that gold has also recently overtaken the U.S. Dollar as the largest global reserve asset. 

At the same time, scaled-back expectations for a U.S. rate hike also contribute positively to gold prices. Gold prices tend to struggle when interest rates rise, as higher rates reduce gold’s appeal relative to yielding assets like bonds.

“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 analyst said. 

Meanwhile, Robin Brooks, Senior Fellow at The Brookings Institution, said in a post on X, “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.” 

According to data from CME FedWatch, the probability of a rate hike from the Fed in September has declined to about 60% from 67% a month ago. In the October meeting, the tool predicts a 70.6% chance of a rate hike, down from 77.3% a month ago. 

What’s Retail Saying?

On Stocktwits, retail sentiment around SPDR Gold Shares ETF (GLD), the largest and most heavily traded gold exchange-traded fund in the U.S., was ‘neutral’ at the time of writing. Meanwhile, sentiment for iShares Gold Trust (IAU) was ‘bearish.’

GLD stock was up about 0.08% at the time of writing, while IAU was up 0.18%. 

One user said, “$GLD always bullish on gold!”

Another user said, “$GLD ~ Gold: Big Picture. Aug 2026. Here’s a quick reminder of where I believe we are in the larger bull trend: the 2026 pullback is only the halfway point of a 10-year rally that should take gold well above 10,000 (silver 500) by the end of the decade into the 2030 reset. As in 2006, I expect the recent lows to hold through the remainder of the bull market. In other words, I believe we just saw a major bottom in summer 2026. Chart & commentary from AG Thorson. Keep accumulating gold & silver & pray for a “VIX 60” panic meltdown in global markets like Aug 2024 & April 2025 to load up on more gold & silver in a temporary price collapse at much lower prices. Good luck, everyone & act accordingly.”

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