Gold Outlook Cut by Goldman Sachs Amid Fed Rate Shift

Goldman Sachs Lowers 2026 Gold Target to $4,900

Goldman Sachs has revised its end‑of‑2026 gold price target down by $500 to $4,900 per ounce, citing a weaker outlook for monetary easing and softer inflows into gold ETFs. The change reflects a shift in expectations around US monetary policy and investor demand for traditional safe‑haven assets.

ETF outflows and regional diverging flows

Analysts at the bank pointed to a slowdown in capital entering gold exchange‑traded funds. World Gold Council data showed roughly $2 billion in net outflows from gold ETFs in May. While Europe continued to record net inflows, Asia posted its first outflow since August 2025, signaling changing dynamics in regional demand.

Options market and bearish positioning

Market sentiment toward gold has softened more broadly. Options‑market indicators show rising demand for put contracts versus calls, reaching some of the highest levels in recent years. That increased bearish positioning in the options market is amplifying downward pressure on the gold price.

Fed policy timeline pushed back

Goldman Sachs also revised its view on Federal Reserve policy, delaying its forecast for the first rate cut into next year. With expectations for earlier easing diminished, higher interest rates could reduce gold's appeal as a non‑yielding asset for investors reallocating between traditional safe havens and digital assets like Bitcoin and other cryptocurrencies.

Downside risk and central bank support

Under a scenario of higher rates, Goldman warns gold could fall further to around $4,400 per ounce by year‑end, as its attractiveness as an inflation hedge weakens. Still, central bank purchases remain a supportive factor: official sector buying picked up again in April, providing an important floor for prices amid weaker private investor flows.

For crypto and macro investors alike, the update underscores the interplay between monetary policy, ETF flows, and demand for both physical precious metals and digital assets when assessing portfolio hedges and risk allocation.