Gold price will shine with declines, experts warn
The Goldman Sachs team lowered its year-end gold price forecast by $500 per ounce, assuming that in December the metal will stabilize at a level of $4,900 per ounce.
Economists say that gold will continue to gain value in the second half of the year relative to current levels, although the growth rate will be lower than previously forecasted.
"Our gold price forecasts remain structurally optimistic, but tactically cautious, with a short‑term downside risk and a medium‑term upside risk," they said.
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The main reason for the forecast revision is a change in expectations about monetary policy, according to which expectations of rate cuts by the Federal Reserve this year were abandoned.
The Fed, keeping rates unchanged on Wednesday, surprised observers with the previously dovish rhetoric of Kevin Warsh and signaled support for hikes.
According to analysts, this still raises concerns about the independence of the U.S. central bank, which has so far been criticized by Donald Trump for not cutting rates.
The war in the Middle East, which in recent months has driven up energy commodity prices, also strengthened expectations of tighter monetary policy.
Analysts, however, have shifted the expected rate cuts to June and December of next year.
Earlier it was expected that cuts would occur in December 2026 and March 2027.
"If the Fed raised rates, demand for gold as a hedge against macroeconomic policy risk could weaken more persistently," they said, adding that the metal could reach a level of $4,400 per ounce by the end of the year.
Rob Kaplan, Goldman Sachs vice‑president and former Dallas Fed president, told Bloomberg Television that the Fed may be forced to raise rates as early as September if inflation remains high.
Analysts added that there are still some factors supporting gold prices, including central bank purchases, with demand of about 50 tons per month in 2026 and 40 tons in 2027.
Chart. Market‑priced probability of the Fed changing rates at upcoming meetings
Source: CME FedWatch Tool.
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Gold and silver prices on Friday, June 19
Gold spot price on Friday, June 19 is at $4,166 per ounce after a drop of 1%.
Chart. Gold spot price (XAU/USD)
Source: Trading Economics.
Silver price fell by 0,77% to 65,1 USD per ounce.
Chart. Silver spot price (XAG/USD)
Source: Trading Economics.
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