Despite surging to record prices this year, demand for gold among U.S. institutional investors has remained surprisingly subdued.A new report from Goldman sachs released Wednesday reveals that American investor holdings of gold remain below 2012 levels, even as major financial institutions publicly recommend increasing allocations to the precious metal. The analysis highlights a disconnect between expert forecasts – with Goldman Sachs projecting a $4,900 spot price by late 2026 – and actual investment trends within U.S. portfolios, where gold currently constitutes just 0.17% of total assets.
Despite reaching record highs this year, investor interest in gold among U.S. firms remains surprisingly muted, according to a new analysis from Goldman Sachs. The report, released Wednesday, indicates that American investor holdings of gold are still below their 2012 peak.
The investment bank attributes this disconnect to the growth of financial portfolios over the past decade outpacing gains in gold prices and trading volume. This suggests that while gold is appreciating, it’s not necessarily attracting significant new capital from U.S. investors.
Gold Accounts for Just 0.17% of Portfolios
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According to the analysis, gold Exchange Traded Funds (ETFs) represent only 0.17% of total U.S. financial portfolios, despite the precious metal’s recent price surge. This figure is particularly low when compared to the approximately $112 trillion held in U.S. stocks and bonds. The findings highlight a potential divergence between broader market sentiment and specific asset allocation strategies.
Goldman Sachs’ data also reveals that over half of U.S. institutions managing more than $100 million in assets do not hold any gold ETFs in their portfolios. Among those that do, allocations typically range from 0.1% to 0.5%.
Physical Gold Demand Remains Limited
While social media buzz surrounding physical gold purchases – such as gold bars at Costco or U.S. Mint coins – has increased, demand for physical gold remains relatively small compared to ETF inflows, Business Insider reports. Year-to-date physical gold demand in the U.S. has been between 11 and 15 tons, while net inflows into global gold ETFs have reached approximately 400 tons.
Analysts Bullish on Gold, U.S. Investors Less So
Goldman Sachs notes that major investment banks and market authorities, including Citi, UBS, Morgan Stanley, BlackRock, and Ray Dalio, have been advising investors to increase their gold holdings. However, these recommendations haven’t translated into substantial investment in the U.S. market.
The bank believes this discrepancy between expert advice and actual investment could fuel the next phase of gold’s price rally. A relatively small increase in allocation could have an outsized impact given the limited supply.
Each Basis Point Increase Could Lift Price 1.4%
Goldman Sachs estimates that a one basis point (0.01 percentage point) increase in the allocation of gold within U.S. investor portfolios could translate to a roughly 1.4% increase in the price of gold. This sensitivity underscores the potential for significant price movement with even modest shifts in investor sentiment.
The bank suggests that even small inflows could significantly boost the “excessively tight” gold market, particularly if global macroeconomic uncertainties and concerns about the U.S. fiscal outlook drive investors toward safe-haven assets.
$4,900 Target by Late 2026
Goldman Sachs projects spot gold to reach $4,900 per ounce by the end of 2026. However, the report cautions that this forecast carries significant upside risk if private sector demand for gold increases. The potential for increased demand adds another layer of complexity to the outlook for the precious metal.
Kaynak: Gazete Oksijen
