Source: Sharecast
The bank said it was raising its forecast "because the inflows driving the 17% rally since August 26th - Western ETF inflows and likely central bank buying - are sticky in our pricing framework, effectively lifting the starting point of our price forecast".
In contrast, noisier speculative positioning has remained broadly stable, it added.
Goldman said that despite the higher starting point, its forecasted 23% price increase by end-2026 remains roughly unchanged.
The bank still expects central bank buying to average 80/70 tonnes in 2025/2026 as emerging markets central banks are likely to continue the structural diversification of their reserves into gold, contributing 19pp to the 23% price increase it expects by end December 2026.
It also still expects Western ETF holdings to rise as the Fed cuts the funds rate by 100 basis points mid-2026, contributing 5pp by Dec 2026.
Finally, GS said it still expects speculative positioning to gradually normalise, contributing -1pp by December 2026.
"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 said.