Central Bank Buying to Propel Gold Rebound by Year-End, Wall Street Institutions Confirm

VG Markets · 2026-05-19T02:38:08Z
Central Bank Buying to Propel Gold Rebound by Year-End, Wall Street Institutions Confirm

Gold has retreated sharply from recent highs, dragging down overall market sentiment. Nevertheless, leading global financial institutions widely expect sustained official-sector gold purchases to drive a gradual price recovery before the close of 2026.

source：Trading Eco


Recovery Seen in Official Gold Purchasing Activity


In a research report dated May 15, Goldman Sachs revised its aggregate forecast and projected average monthly central bank gold purchases will rebound to 60 tonnes throughout 2026.


The 12-month rolling average of central bank gold inflows stood at 50 tonnes as of March, notably higher than the prior estimate of 29 tonnes. Co-authors Lena Thomas and Dan Struven stressed the upward revision reflects far stronger underlying official demand than previously priced in by markets.


Internal institutional surveys reveal solid structural appetite for gold among global central banks. Escalating geopolitical tensions are set to further accelerate reserve diversification trends across nations in the longer run.


Heightened Middle East tensions have capped gold’s upside in the near term. Surging energy costs have stoked broad-based inflationary pressures, delaying monetary easing cycles and triggering a widespread bond market selloff. As a non-interest-bearing asset, gold has faced obvious downward pressure amid such market shifts.


Even with near-term headwinds intact, Goldman Sachs maintains its bullish outlook, setting a year-end gold target of **$5,400 per troy ounce**. Spot gold was trading near $4,534 per ounce as of May 18.


Q1 Official Gold Buying Rises Quarter-over-Quarter


Latest statistics released by the World Gold Council show global central banks purchased 244 tonnes of gold in the first quarter, exceeding the 208 tonnes registered in the final quarter of last year. The resilient official demand remains unaffected by short-term price volatility, which is fully in line with Goldman Sachs’ core assessment.


Broad Bullish Consensus Across Global Institutions


Beyond Goldman Sachs, multiple top-tier financial houses have issued upbeat gold outlooks.

  • UBS forecasts gold will hit **$5,600 per ounce** by end-2026, with silver expected to reach $100 per ounce over the same timeframe.
  • ANZ Bank holds an even more optimistic view. It argues energy-driven economic slowdown will boost safe-haven inflows, potentially lifting gold prices to $6,000 per ounce.
  • JPMorgan and other mainstream institutions have also voiced positive views on gold’s medium and long-term trajectory.


Prudent Views Remain for Near-Term Price Action


Analysts warn investors not to overlook short-term downside risks. Gold is widely regarded as a highly liquid reserve asset for private investors. Should equities face heavy liquidation amid rising interest rates and softening growth prospects, investors may offload gold positions to shore up cash holdings, thereby weighing on bullion prices.


The research team also updated its calculation methodology for official gold purchases. Traditional data reliant on UK trade flows can no longer fully capture real market dynamics, suggesting actual central bank buying volumes may exceed official published figures.


In summary, near-term gold prices will still be swayed by equity swings and interest rate movements. However, steady and persistent official-sector

demand will serve as solid fundamental support. While institutional year-end price targets range from $5,400 to $6,000 per ounce, the mainstream market unanimously affirms gold’s upward trend in the second half of the year.