Goldman Sachs has sharply lowered its gold price forecasts, cutting its end-2026 target by $500 an ounce as the US Federal Reserve's more hawkish stance weighs on investor demand for the metal.

The cut

The bank lowered its end-2026 gold price forecast to $4,150 an ounce from $4,650, and reduced its end-2027 target to $4,800 from $5,400. The revision came in a report published on Thursday, 5 November, by analysts Lina Thomas and Daan Struyven, titled "Precious Metals Analyst Report: Long-Term Bullish on Gold, But Not Now".

Goldman said that although the recent rebound in the bond market had brought market pricing closer to its economists' view of the Fed's terminal rate, its baseline assumes the Fed keeps raising rates through December 2026. That, the bank argued, would dampen investors' concerns about currency depreciation and pull macro hedging demand for gold — seen mainly in demand for call options — back towards historical averages.

Gold slips on the day

Spot gold fell 0.6% to $4,063.39 an ounce in early trading on Friday, 6 November, as a rebound in oil prices fanned inflation worries and reinforced expectations that interest rates would stay higher for longer. Traders put the chance of another Fed rate rise in December at about 68%, according to CME's FedWatch tool.

Gold had rallied 5.5% over the previous seven sessions, bouncing from a one-year low near $3,870 on 30 October, but remains well below its January record high of just over $5,500 an ounce.

Central banks still buying

Goldman still sees a floor under the metal from official buyers. The bank expects central bank gold purchases to stay at about 60 tonnes a month through 2026 and 2027, and the World Gold Council reported that central banks bought a net 321 tonnes in the third quarter of 2026.