Goldman Sachs: Gold is the ‘Best Investment Bet’ for 2026 Targeting $4,900

A group of commodity strategists at Goldman Sachs views gold as the best investment bet within the entire commodity complex for the coming year. They note that if retail investors join central banks in the wave of asset diversification, gold prices could easily exceed their base case scenario of $4,900 per ounce.

In their 2026 Commodity Outlook report, the strategists stated: "The race for supremacy between the United States and China in the fields of artificial intelligence and geopolitical power, alongside global energy supply shifts, form the core of our key convictions."

They added: "Commodity indices achieved strong total returns in 2025 (e.g., the BCOM index returned about 15%), driven by extremely high returns in industrial metals, and particularly precious metals, which tend to benefit from Federal Reserve interest rate cuts, offsetting limited negative returns in the energy sector."

Looking ahead, Goldman Sachs explained that its base economic scenario assumes "strong global GDP growth and U.S. interest rate cuts of about 50 basis points during 2026," which should support strong commodity returns once again.

2026 Outlook

Analysts highlighted two main trends they expect to drive commodity performance over the next year: "First, on the macro front, commodities will remain at the heart of the geopolitical and technological power race between the U.S. and China, including AI supremacy. Second, on the micro front, two major waves in energy supply—which began in 2025—drive our expectations for energy markets."

Among all commodities covered in the report, Goldman Sachs expresses the most optimism toward gold, with strong demand from central banks being a primary reason.

The report stated: "We expect central bank gold buying to remain strong in 2026, averaging 70 tons per month (compared to an average of 66 tons over the last 12 months, but four times the pre-2022 average of 17 tons). This is expected to contribute about 14 percentage points to the projected price increase by December 2026, for three main reasons."

The analysts outlined these reasons, saying: "First, the freezing of Russian reserves in 2022 marked a pivotal turning point in how emerging market reserve managers view geopolitical risk. Second, gold’s share of reserves in some emerging market central banks—such as the People's Bank of China—remains relatively low compared to global peers, especially given China's ambition to internationalize the Yuan. Third, surveys show central bank appetite for gold reaching record levels."

Analysts also see additional upside risks to their price forecasts if this diversification trend broadens to include retail investors—a phenomenon that has already begun creating competition for bullion between investors and central banks, contributing to gold's multi-year bull market.

The report noted that: "Gold ETFs represent only 0.17% of U.S. retail financial portfolios, which is 6 basis points below their peak in 2012."

They added: "We estimate that every one basis point increase in gold's share of U.S. financial portfolios—driven by additional investor purchases rather than price appreciation—leads to a rise in gold prices of about 1.4%."

Goldman Sachs also emphasized the insurance value that commodities provide to investor portfolios in the current geopolitical environment.

Analysts said: "While gold remains our preferred commodity for long-term investment, we see a strong role for broader commodity exposure within strategic portfolio allocations."

They added: "The high geographic concentration of commodity supplies, coupled with escalating geopolitical, trade, and technological competition, has led to the use of commodity control as a leverage tool more frequently, increasing the risk of supply disruptions and enhancing the insurance value of commodities."

The report warned that: "Equity and bond portfolios are not sufficiently diversified in scenarios where commodity supply losses lead to slower growth and higher inflation simultaneously, coinciding with commodities achieving strong returns."

Price Forecasts

Goldman Sachs expects gold prices to retreat to levels near $4,200 per ounce during the first quarter of 2026, before rebounding to current levels above $4,400 in the second quarter. It is then expected to record a new historical peak near $4,630 in the third quarter, reaching approximately $4,900 per ounce by the end of the fourth quarter of the year.