Goldman trims its golden forecast $500 thinner, leaving Bitcoin holding the same wait-and-see bag 🪙

Goldman Sachs has cut its year-end gold price target by $500 an ounce, lowering the projection to $4,900 from a prior estimate of $5,400, citing expectations that the US Federal Reserve will not cut interest rates this year. The bank now assumes the next Fed reductions could be pushed to March 2027 and December 2027. "Our gold price views remain structurally constructive but tactically cautious, with near-term downside risk and medium-term upside risk," Goldman Sachs commodity analysts Lina Thomas and Daan Struyven said, according to Bloomberg.

A delay in US rate cuts could also weigh on cryptocurrencies, as lower interest rates have historically been favorable for digital assets such as Bitcoin. Bitcoin has fallen 28.3% since January, while gold has declined more than 22% since its January all-time high of $5,327 per ounce. Gold now sits just $135 away from dipping below $4,000, a level not seen since November, according to GoldPrice.

Analysts have flagged further headwinds for both assets following a 4.2% annual increase in the US Consumer Price Index in May, coupled with the ongoing conflict in the Middle East. Because gold pays no yield, rising rates can make holding gold more expensive relative to bonds or cash, and the market may be repricing the "easy money" thesis that propelled gold to record highs earlier this year. "Only when inflation drops, rate cuts become viable, and liquidity improves alongside lower capital costs, will the overall risk appetite truly reverse," HashKey Group senior researcher Tim Sun told Cointelegraph.

CME's FedWatch tool shows a high probability of rates remaining unchanged or rising in the remaining months of 2026, compared with the current target rate of 3.5% to 3.75%. Last week, Bitwise analysts noted that Bitcoin remains deeply discounted versus AI-stocks even as the prospect of a hawkish Fed continues to loom over the crypto market.