Goldman Sachs updated its gold price forecast to $2,700 per ounce by the end of the year.
GS says recent price increases are unrelated to the usual gold-related macroeconomic factors, “real rates, growth expectations, and the dollar.”
- “None of these traditional factors adequately explain the speed and magnitude of the gold price movement so far this year.”
GS quote:
- constant demand from central banks, including the People’s Bank of China (PBOC)
- increased retail demand from Chinese investors
- rising demand for gold in the United States, with Wells Fargo estimating that Costco’s gold operations generated sales of up to $200 million per month
- demand for gold as a safe haven could increase depending on any Fed rate cuts that may occur and the results of the US elections.
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I’m surprised they didn’t mention the role of asset confiscations by Western governments and the role they likely play in the demand for physical gold.
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