Goldman Sachs Forecasts $4,000 Gold Amid Growing Demand for Safe-Haven Assets

Goldman Sachs Group Inc. and UBS Group AG have raised their price forecasts for gold, citing stronger-than-expected central bank demand and the metal’s role as a hedge against both economic slowdowns and geopolitical uncertainties, Bloomberg reports.

According to separate reports issued by the banks, the outlook for gold prices has become increasingly bullish, with both institutions predicting higher prices in the coming years.

Goldman Sachs analysts, including Lina Thomas, now expect gold to reach $3,700 an ounce by the end of 2025, with a potential surge to $4,000 an ounce by mid-2026. Similarly, UBS strategist Joni Teves forecasted that gold could climb to $3,500 an ounce by December 2025. These updated projections come after gold experienced a notable 6.6% increase last week, reaching a fresh record high of over $3,245 an ounce on Monday.

The upward revision in price targets reflects growing confidence in gold as an investment during periods of heightened uncertainty. As the global economy faces increasing risks, including trade tensions linked to US President Donald Trump’s policies, both Goldman and UBS believe that gold will continue to attract strong demand. In particular, central banks are expected to increase their purchases, with Goldman analysts predicting that official-sector purchases will average 80 tons per month in 2025, up from their previous estimate of 70 tons.

Rising concerns about a potential recession are also supporting the outlook for gold. Goldman’s analysts noted that investor demand has been rising, driven by fears of economic downturns and the possibility of declines in riskier assets. The bank’s economists have estimated a 45% chance of a recession, and if this scenario unfolds, ETF inflows into gold could accelerate, potentially lifting prices to as high as $3,880 an ounce by year-end.

UBS, on the other hand, highlighted the broadening base of gold investors, including central banks, long-term asset managers, macro funds, private wealth clients, and retail investors. As global trade dynamics and geopolitical risks continue to shift, UBS expects strong and diverse demand for gold. The bank noted that despite the growing interest in gold, there is still room for further exposure, as market positioning has not yet become overcrowded.

Teves also pointed to the persistence of uncertainty as a key factor fueling the demand for gold. With increased volatility in global markets and a more diversified investor base since the financial crisis of 2008, gold has become a popular choice for portfolio diversification. In addition, she noted that thinner liquidity conditions—resulting from limited mine supply growth and large quantities of gold held in central bank reserves and ETFs—could amplify price movements.