Goldman Sachs remains constructive on gold for the long run, saying in a note that recent Federal Reserve tightening should slow the metal's advance in the near term but is unlikely to derail the rally toward its 2027 target.
Analyst Lina Thomas held to a $5,400-an-ounce forecast for the end of 2027, a stance she reiterated after the Fed's latest rate increase and amid economists' expectations for an additional hike in October. According to Goldman, the path of higher interest rates will exert pressure on gold primarily through reduced exchange-traded fund (ETF) demand in the short term.
At the same time, Goldman projects the Fed will cut rates three times between September 2027 and March 2028 while keeping the terminal policy rate unchanged. "We expect the impact of tighter monetary policy to be felt primarily through a slower near-term appreciation path rather than a lower terminal gold price," Thomas wrote.
The bank also revised its near-term fair value estimate, trimming the year-end figure to $4,650 an ounce from $4,900. That revised fair value remains above the recent spot price, which Goldman cites at about $4,350 an ounce, and the firm noted that much of the tightening in markets is already reflected in ETF demand.
Goldman continued to expect a steady upward trend in gold prices in the near term, arguing that stronger-than-expected central bank purchases would offset the remaining drag from higher policy rates. The bank attributed nearly all of its expected 23% total appreciation through the end of 2027 to central bank buying, which it says is running at roughly 91 tonnes a month - a pace well above the pre-2022 average of 17 tonnes per month.
Thomas flagged that upside risks dominate the outlook, pointing to resilient call-option demand for gold as evidence of its appeal as a macro-policy hedge. At the same time, she cautioned that market volatility could increase on both sides.
"Conversely, a significantly more hawkish Fed path could generate an sharper-than-usual correction," Thomas warned.
The note frames higher rates as a moderating factor for ETF flows in the near term, rather than a force that would push Goldman's terminal price lower. Central bank purchases are presented as the main structural support underpinning Goldman's bullish view for 2027.
Bottom line: Goldman keeps a bullish 2027 target for gold at $5,400 an ounce while acknowledging that Fed rate increases will slow near-term appreciation, with central bank buying expected to drive most of the projected gains.