Gold has recently surpassed the $4,000 mark, prompting a flurry of activity among analysts as they scramble to reassess their price forecasts. Of U.S. investors, only 38 percent own gold today. In part, the yellow metal’s extraordinary ascent — up more than 52 percent this year and an incredible 95 percent since January 2024 — has understandably turned heads on all parts of the financial landscape.
Goldman Sachs—yes, the investment bank—has recently increased its 2026 gold-price target to $4,900. The bank points to the strong demand – driven by recent and persistent purchases from central banks. Add to this a massive wave of investment pouring in from Western markets. This adjustment comes as gold has experienced unprecedented growth, leading analysts to reconsider previous estimates in light of the new market dynamics.
The increase in gold prices has had a tremendous impact on investor psychology. Western investors funneled $64 billion into gold exchange-traded funds (ETFs) through September. Just in the month of September, they have invested a breathtaking $17.3 billion. This trend is yet another testament to the incredible investor demand for ETFs as a means of accessing the gold market. In fact, reported demand for physical bars and coins fell 53 percent YOY during the first half of 2025.
Gold prices overwhelmingly broke impressive records this year. Analysts are cautioning that central banks are slowing their gold buy-up. The World Gold Council noted that gold’s rally, up 26 percent to record levels, has likely contributed to the slowdown in central bank buying. Despite the economic uncertainty, central banks are still keen on gold as a strategic asset.
Bart Melek, the Head of Market Strategy at TD Securities, has gone all-in. He updated his gold price prediction to $4,400 in Q2 2026. He welcomes future price decreases as chances to buy at a bargain.
“Conviction buyers tend to purchase the yellow metal consistently, regardless of the price, and based on their view on the economy or to hedge risk.” – Goldman analysts
Melek’s perspective aligns with the broader sentiment among analysts who believe that while gold may appear overbought, it remains an essential asset.
“The yellow metal looks overbought, which suggests that anything that may question the speed of the Fed’s easing or an increase in volatility could generate a robust downside.” – Bart Melek
This word of warning highlights the challenges in investing in gold as the macroeconomic landscape continues to shift. Goldman analysts note that the overall macroeconomic environment today is characterized by high inflation and geopolitical/global policy uncertainty. This creates a backdrop that makes gold a much more attractive option relative to other conventional safe-haven assets such as Treasuries.
In recent months, demand dynamics have changed in a big way. ETFs are becoming the preferred vehicle for Western investors. At the same time, demand for Chinese gold bars and coins has rocketed by 44 percent year-on-year in the first half of 2025. In marked opposition, Americans have been selling their gold holdings, pointing to opposing trends within global markets.
The current – and unprecedented – central bank accumulation is the leading trend driving gold’s direction. Analysts at Goldman Sachs point out that demand for gold remains dormant. They warn that assuming the private sector diversifies into this highly concentrated, relatively small market could lead to holdings in ETFs far exceeding existing estimates.
“We see the risks to our upgraded gold price forecast as still skewed to the upside on net because private sector diversification into the relatively small gold market may boost ETF holdings above our rates-implied estimate.” – Goldman analysts
Central banks continue to walk a dangerous tightrope of economic unknowns. Their tactical acquisitions of gold highlight their deep faith in its stability as a buffer against inflation and market upheaval.