Central Bank Gold Purchase Surge: Goldman Sachs predicts reaching 60 tons by 2026, driven by distrust in fiat currency

According to the latest news, Goldman Sachs expects the average gold purchase by central banks worldwide in 2026 to reach 60 tons. This figure may seem ordinary, but when considering the current global macro environment and gold market performance, it reflects a deeper signal: a re-evaluation of traditional reserve assets by global central banks and a collective pursuit of hard assets.

The New Normal of Central Bank Gold Purchases

From Diversification to Collective Betting

Goldman Sachs explicitly states in its forecast that emerging market central banks are likely to continue diversifying their reserves structurally from other assets into gold. This is not a passing trend but a long-term strategic shift.

According to relevant data, global central banks are expected to net purchase 950 tons of gold in 2026, meaning that the “average purchase” of 60 tons actually masks a more aggressive reality: emerging market central banks are increasing their gold reserves at an unprecedented pace.

Several key drivers underpin this trend:

• Weakening dollar credibility: Increasing controversy over the Federal Reserve’s independence, the US’s $38 trillion debt pressure continues to rise, prompting central banks to seek hedges outside the dollar
• Rising geopolitical risks: Tensions in Iran, the US, and other regions make gold the most stable sovereign credit hedge
• Expectation of rate cut cycles: Rate cuts of 25 basis points by the Fed in June and September are mainstream expectations, lowering the cost of holding gold in a low-interest-rate environment
• Changes in supply-demand structure: Global gold production has peaked and will enter a recessionary phase after 2026, pushing up demand due to scarcity

Perfect validation of predictions and reality

Interestingly, Goldman Sachs’s forecast has already been partially validated in reality. According to the latest data, gold hit a record high of $4,690 on January 19, just 2% below the $4,900–$5,000 target range predicted by Goldman Sachs and UBS.

The world’s largest gold ETF has recently accumulated over 23 tons, hedge funds are highly active in allocations, and market demand structures continue to optimize. All these point to the same conclusion: the era of hard assets has truly arrived.

Why Are Central Banks Buying Gold?

The Crisis of Fiat Currency Credibility

The answer is quite straightforward: central banks no longer fully trust paper money.

During rate cut cycles, central banks face a dilemma. On one hand, economic growth requires loose monetary policy; on the other hand, prolonged low interest rates have inflated asset bubbles and increased debt risks. In this environment, gold becomes the last line of defense.

Rather than saying central banks are “buying gold,” it’s more accurate to say they are “allocating uncertainty.” Gold has no issuer, cannot depreciate, and does not rely on any country’s credit promises. In times of global macro chaos, these characteristics are especially valuable.

The Inevitable Choice of Diversification

The shift among emerging market central banks is particularly noteworthy. These countries’ central banks have long held US dollars as their main reserve asset, but in recent years, the US dollar’s international standing has been challenged. The internationalization of currencies like the euro and renminbi, along with increased US sanctions on allies, have accelerated the pace of reserve diversification.

In this process, gold acts as a “neutral asset.” Regardless of geopolitical changes, gold’s value can be recognized globally.

Market Chain Reactions

The Rise of Hard Assets Across the Board

The increase in central bank gold purchases is triggering a broader wave of hard asset allocation. Silver has also recently hit a new high, breaking $94 per ounce. This is not a coincidence but a different manifestation of the same macro narrative.

When large funds (including central banks and institutional investors) seek hard assets for hedging, the entire commodities market benefits. Silver, with its smaller size, higher volatility, and industrial demand, has become a high-beta choice.

Implications for Crypto Assets

Interestingly, the logic behind central bank gold purchases resonates with the value proposition of crypto assets. Bitcoin, as “digital gold,” similarly does not rely on any central institution’s credit promises and has gained new narrative support in environments of declining fiat credibility.

Although these two asset classes operate through entirely different mechanisms, they both answer the same question: when the credibility of traditional financial systems cracks, how should people protect their wealth?

Future Outlook

The Upside Potential of Gold Prices

Based on central bank purchase expectations and current market performance, the possibility of gold surpassing $5,000 is increasing. The $4,900–$5,000 target range predicted by Goldman Sachs has shifted from a “possible scenario” to a “reasonable expectation.”

More aggressive forecasts even mention silver targets of $120 or $180. While these sound exaggerated, in scenarios of supply constraints and demand surges, such extreme outcomes are not entirely impossible.

The Continuity of Central Bank Purchases

This trend is unlikely to be a flash in the pan. As long as doubts about dollar credibility persist and geopolitical risks remain, central banks will be motivated to continue increasing their gold reserves. An expected annual purchase of 960 tons indicates that the demand side of this market has already formed a long-term support.

Summary

Goldman Sachs’s forecast of an average 60-ton gold purchase reflects a larger macro shift: global central banks are collectively adjusting their reserve structures, moving from reliance on fiat currency to diversification. This shift stems from concerns over fiat currency credibility and recognition of the scarcity of hard assets.

When central banks are all buying gold, it’s no longer just an investment choice but common sense in asset allocation. The current gold price approaching $4,900 is the best testament to this major trend. For market participants, understanding this central bank shift may be more important than chasing short-term volatility.