Gold Eyes $3,300 Amidst Central Bank Buying and ETF Inflows: Goldman Sachs

Key Points:

* Goldman Sachs raises year-end gold target to $3,100, citing central bank buying and ETF inflows.
* Central bank demand estimated at 50 tons monthly, above previous expectations.
* Economic uncertainty, including tariffs, could drive gold to $3,300 due to increased speculative positioning.
* Gold's surge driven by central bank purchases, Fed rate cuts, and investor concerns over trade tensions.

Goldman Sachs analysts Lina Thomas and Daan Struyven remain bullish on gold, reiterating their "Go for Gold" recommendation. They attribute the metal's value to its hedging potential amidst rising trade tensions.

Inflation fears and fiscal risks may prompt central banks to increase gold holdings, especially those holding large U.S. Treasury reserves.

Official-sector purchases in December totaled an estimated 108 tons, contributing to the upward revision in Goldman's forecast.

ETF holdings are also expected to receive a boost from anticipated Fed interest rate cuts.

Gold's strong performance continues, surpassing global stock market gains by a significant margin. Spot gold currently trades near $2,912, having recently set a record above $2,942.

Conclusion:

Goldman Sachs' bullish outlook aligns with predictions from other major banks, underscoring the growing demand for haven assets amid geopolitical uncertainties and trade wars.