Goldman Sachs Lops $500 Off Gold Target on No Fed Cuts This Year

Goldman Sachs Group Inc. lowered its year-end gold price target by $500 per ounce, projecting a price of $2,300 per ounce. This adjustment, announced on May 21, 2024, stems from the firm's revised expectation that the U.S. Federal Reserve will not implement any interest rate cuts in 2026. Previously, Goldman Sachs had anticipated two quarter-point rate reductions by the end of that year. The firm's analysts, including Eugene King, cited the Federal Reserve's updated economic projections as the primary driver for this shift in outlook. The expectation of sustained higher interest rates for a longer duration typically dampens demand for non-yielding assets like gold. This revised forecast places Goldman Sachs' gold target below the current market price of approximately $2,350 per ounce.