Analysts Consider Up to $3,680 per Ounce Possible!
Like the analysts at Saxo Bank, Goldman Sachs now expects the gold price to reach $3,300 per ounce by the end of 2025. They cite stronger-than-expected central bank demand and steady inflows into physically backed gold ETFs as reasons.
The US investment bank’s positive sentiment towards the precious metal is evident in the fact that they had already raised their gold price target to $3,100 per ounce just last month. Now, however, they point out that central bank demand this year could amount to 70 tons instead of the previously estimated 50 tons – per month.
The gold price has already increased by nearly 16% in 2025, continuing the strong rise from the previous year, partly due to the looser monetary policy of the US Federal Reserve. The fact that an ounce of the precious metal now costs more than $3,000 is also attributed to the controversial and inconsistent trade and foreign policy of the Trump administration, which has created great uncertainty regarding the further development of the global economy.
Central Bank Purchases Increase Significantly
According to Goldman Sachs, central banks, the so-called official sector, bought around 190 tons of gold per month from November to January. Moreover, there is a possibility that China will continue to rapidly expand its gold reserves for at least three more years. The analysts see the sharp increase in central bank purchases as a structural change in currency reserve management and do not expect this to change in the short term.
Inflows into gold ETFs have also increased more than expected, the report continued. Demand for gold as a hedging option has likely driven this demand. Goldman Sachs now expects the Fed to cut interest rates twice this year and points out that inflows and outflows in gold ETFs generally follow interest rate developments. If accelerating demand for hedging options leads ETF holdings to return to levels seen in 2020 – due to the pandemic – analysts consider a gold price of $3,680 per ounce possible.
