Under the rise of gold, Goldman Sachs analyst Nicholas Snowdon and the commodity research team continue to advocate for gold and set a target price of $2,175 per ounce for the next 12 months.
In the past year, gold has performed well among various assets, with a cumulative increase of over 15% for the whole year. The highest price once broke through $2,100 per ounce, reaching a historical high.
As we enter 2024, conflicts in the Middle East and Russia-Ukraine have not ceased, and coupled with market speculation that global central banks will cut interest rates on a large scale this year, gold remains strong.
As of the time of writing, the price of gold is still above $2,000 per ounce.
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Goldman Sachs stated that there are many variables that affect the price of gold, among which US bond yields, the US dollar, and geopolitical risks play a decisive role:
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In 2023, the performance of gold decoupled from real interest rates, and its main attraction lies in its role as a tail risk hedge tool.
When global geopolitical tensions escalate, the demand for gold increases.
Gold itself does not generate interest, and the previous expectation of a rate cut by the Federal Reserve has helped push up the price of gold.
The US dollar and gold are both central bank reserve assets, and they have a substitution effect. Their prices have a seesaw relationship. When the US dollar weakens, the price of gold rises, and vice versa. Currently, the expectation of a significant rate cut by the Federal Reserve has caused the US dollar to weaken, which helps enhance the attractiveness of gold.
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In addition, the market's investment demand for gold has also driven up the price. There is still room for speculative positions to rise:
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According to ETF investment demand data, investors have not yet purchased and held a large number of gold ETF shares, and the market's interest in gold ETFs has not improved.
According to COMEX speculative position data, the current net long position is at the 87th percentile, indicating that there are relatively more bullish positions in gold, and there is still room for speculative positions to rise.
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Macroeconomic data such as CPI, PPI, or unemployment rate affect investors' sentiment towards gold:
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When there is deflation, investors seek refuge in gold, and gold performs well.
When the unemployment rate rises and the employment situation is poor, investors seek refuge in gold, pushing up gold demand.
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Emerging market central banks have become the main buyers of gold, and the retail demand for gold in this market has shown strong growth:
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In 2023, when geopolitical risks increase, emerging market central banks become the main buyers of gold. As of October 2023, the scale of central bank gold purchases has grown by 14% year-on-year.
As of September 2023, retail demand for gold in emerging markets has grown by 6% year-on-year.
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Analysts point out that US bond yields, the US dollar, geopolitical risks, and demand from emerging markets will collectively drive up international gold prices.

Goldman Sachs supports gold! It is expected to rise to $2,175 within a year.