Goldman Sachs Bullish on Gold Prices as Federal Reserve Prepares for Interest Rate Cut
Goldman Sachs, one of the leading investment banks, has reaffirmed its positive stance on gold prices in light of the upcoming interest rate cut by the U.S. Federal Reserve. The bank pointed to strong central bank demand and the anticipation of a significant rate reduction as key drivers for the precious metal’s surge.
Gold prices soared to a record high of $2,589.6 per ounce on Monday, fueled by a weakening dollar and expectations of a sizable rate cut by the Fed. Market indicators suggest a 33% probability of a 25-basis-point cut and a 67% likelihood of a 50-bps cut at the Fed’s upcoming policy meeting.
Despite potential short-term fluctuations, Goldman Sachs maintains a bullish outlook on gold prices, with a price target of $2,700 per troy ounce by early 2025. The bank highlighted the impact of central bank demand and interest rate changes on gold prices, emphasizing the growing popularity of exchange-traded funds backed by physical gold in a low-rate environment.
In summary, investors should take note of Goldman Sachs’ optimistic view on gold prices and the potential benefits of diversifying their portfolios with gold assets. With the Federal Reserve’s interest rate decision looming, now may be an opportune time to consider adding gold to their investment strategy for long-term growth and stability.
