Gold Poised to Outperform Commodities in 2026 on Strong Central Bank Demand: Goldman Sachs
Gold | 2025-12-29 04:57:11
The bank also points to upside risks from private investors, noting that gold exchange-traded funds currently represent just 0.17% of U.S. private financial portfolios.
By Paul Ploumis
SEATTLE (Scrap Monster): Gold is set to remain the top-performing commodity in 2026, underpinned by robust central bank demand and heightened geopolitical risks, according to Goldman Sachs’ latest commodities outlook.
The investment bank expects central banks to continue buying an average of 70 tonnes of gold per month next year—nearly four times the pre-2022 average—reflecting persistent concerns over reserve security following the freezing of Russia’s assets in 2022. Goldman Sachs estimates that central bank purchases alone could account for around 14 percentage points of its projected gold price increase by December 2026.
The bank also points to upside risks from private investors, noting that gold exchange-traded funds currently represent just 0.17% of U.S. private financial portfolios. Even a marginal rise in portfolio allocation could significantly lift prices. Against this backdrop, Goldman Sachs forecasts gold prices to surge to USD 4,900 by December 2026. Silver is expected to benefit from the broader strength in precious metals, particularly in an environment of potential Federal Reserve rate cuts.
In base metals, copper is forecast to consolidate after a strong rally driven by tariff-related expectations. Goldman Sachs projects average copper prices of USD 11,400 per tonne in 2026. Despite near-term consolidation, the long-term outlook remains positive, supported by electrification, AI, power grid expansion, and defence-related demand.
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What is the biggest factor likely to drive gold prices higher in 2026?
Frequently Asked Questions
- Why does Goldman Sachs expect gold to outperform in 2026?
Gold’s outlook is supported by robust central bank demand, reserve diversification concerns, and heightened geopolitical risks.
- How significant is central bank demand to gold prices?
Goldman Sachs estimates central bank buying could contribute around 14 percentage points to gold’s price increase by December 2026.
- What role could private investors play in gold’s upside?
Gold ETF holdings currently make up a very small share of U.S. private portfolios, meaning even modest allocation increases could materially boost prices.
