Goldman Sachs Slashes Gold Forecast: What Their Doubt on Rate Cuts Means for Your Investments

So, Goldman Sachs just trimmed its year-end gold prediction by a hefty $500 an ounce, now pegging it at $4,900 instead of $5,400 — all because they reckon the Federal Reserve won’t be slashing interest rates anytime soon. It’s like waiting for a sequel to your favorite movie that keeps getting pushed back… only this one’s got real money riding on it. Their analysts are playing it safe: optimistic overall but eyeing some bumps on the road ahead. Meanwhile, this delay could throw a wet blanket on crypto as well, with Bitcoin already down over 28% since January—ouch. And gold? It’s flirting dangerously close to dropping below $4,000, a level we haven’t seen since last November. Makes you wonder: in a world where patience is a virtue, how long are investors willing to stay on the sidelines before they throw in the towel or double down? It’s a wait-and-watch game with high stakes—because when the Fed finally decides to move, it might just rewrite the playbook for both bullion and digital assets alike. LEARN MORE.

Goldman Sachs lowered its year-end gold forecast by $500 an ounce, citing expectations that the US Federal Reserve won’t cut interest rates this year.

The revised target places gold at $4,900, down from earlier estimates of $5,400. It comes on the assumption that the next Fed cuts could be pushed to March 2027 and December 2027.

“Our gold price views remain structurally constructive but tactically cautious, with near-term downside risk and medium-term upside risk,” Goldman Sachs commodity analysts Lina Thomas and Daan Struyven said, according to Bloomberg.

A delay in US interest rate cuts could also weigh on cryptocurrencies, as lower interest rates tend to be favorable for digital assets such as Bitcoin. The war in Iran has also taken its toll on the assets.

Bitcoin has fallen 28.3% since January, and gold has declined more than 22% since its January all-time high of $5,327 per ounce. Gold is now just $135 away from dipping below $4,000, a level not seen since November, according to GoldPrice.

Gold price one-year chart. Source: GoldPrice

Last week, analysts cautioned that Bitcoin and gold may face further headwinds this year following a 4.2% annual increase in the US Consumer Price Index in May, coupled with the conflict in the Middle East.

Since gold pays no yield, rising rates could mean that holding gold becomes more expensive relative to bonds or cash, and the market may be repricing the entire “easy money” thesis that drove gold to record highs earlier this year.

“Only when inflation drops, rate cuts become viable, and liquidity improves alongside lower capital costs, will the overall risk appetite truly reverse,” HashKey Group senior researcher Tim Sun told Cointelegraph.

CME’s FedWatch tool shows a high chance of rates staying the same or rising in the remaining months of 2026, compared with the current target rate of 3.5% to 3.75%.

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