Goldman Sachs raises year-end gold price forecast to USD 3,100

Goldman Sachs on Monday raised its year-end 2025 gold price forecast to USD 3,100 per ounce, up from USD 2,890, citing sustained central bank demand.

The bank estimates that “structurally higher central bank demand will add 9% to the gold price by year-end, which combined with a gradual boost to ETF holdings as the funds rate declines.”

This should outweigh the drag from normalizing investor positioning, assuming uncertainty diminishes, Goldman Sachs added.

However, if policy uncertainty, including tariff concerns, remains high, Goldman sees the potential for gold to surge to USD 3,300 per ounce by year-end due to prolonged speculative positioning.

The bank has also revised its central bank demand assumption upward to 50 tonnes per month from the previous estimate of 41 tonnes.

If purchases average 70 tons per month, gold prices could climb to USD 3,200 per ounce by the end of 2025, assuming positioning normalizes, Goldman said.

Conversely, if the Federal Reserve keeps interest rates steady, the bank expects gold to reach USD 3,060 per ounce in the same period, the bank added.

Reiterating its “Go for Gold” trading recommendation, Goldman Sachs said that while declining uncertainty could lead to a tactical pullback in prices, long gold positions remain a strong hedge.

This is particularly relevant in the face of potential trade tensions, Federal Reserve subordination risks, and financial or recessionary threats, which could push prices toward the upper end of Goldman’s high-uncertainty range, the bank said.

Additionally, if concerns over US fiscal sustainability escalate, Goldman Sachs sees gold rising an extra 5% to USD 3,250 per ounce by December 2025.

Growing fears of inflation and fiscal risks could drive speculative positioning and ETF flows higher, while worries about US debt sustainability may encourage central banks, especially those with large US Treasury reserves, to increase their gold purchases, the investment bank added.

(Reporting by Sherin Elizabeth Varghese in Bengaluru)

RBA poised, China tech booms, Japan GDP sizzles

There’s no shortage of market-moving news in Asia on Tuesday, with an Australian interest rate decision, China’s tech boom and sizzling Japanese GDP figures front and center for investors, against a backdrop of unfolding geopolitical drama around US-Europe relations and the Russia-Ukraine war.

On the economic front, the main event locally will be the Reserve Bank of Australia’s expected quarter-point cut to its cash rate to 4.10%, its first reduction in over four years.

Easing inflation has opened the door for a rate-cutting cycle, but only a shallow one – money markets are pricing in only 50 basis points of additional easing this year after Tuesday’s move.

If the RBA does lower rates on Tuesday, it will be one of the last G10 central banks to do so. Norway’s central bank hasn’t started easing yet, while the Bank of Japan is raising rates.

That cycle could accelerate, after figures on Monday showed Japan’s economy grew at an annualized 2.8% pace in the October-December quarter, nearly three times faster than the consensus 1.0% in a Reuters poll. The highest forecast in the survey of 17 economists was 2.2%.

The yen and Japanese Government Bond yields are on the rise. Recent inflation and wage growth data have also surprised to the upside, but the Bank of Japan will be cautious about raising rates after decades of deflation and ultra-loose policy.

Two-year and 10-year JGB yields are already the highest since 2008 and have risen sharply in recent months, roughly doubling since September. These are big moves, and the impact on businesses, households and investors remains to be seen.

The rebound in Chinese markets continues, meanwhile, with tech shares listed in Hong Kong hitting a three-year high on Monday as President Xi Jinping sat down with top tech leaders in Beijing. The Hang Seng tech index is up more than 30% in a month.

The symbolism of Xi’s rare meeting with tech leaders is powerful, reflecting policymakers’ worries over the economy and China’s technological development, and marks a sharp turnaround from the regulatory clampdown on tech four years ago.

Shares in Baidu plunged on Monday, however, wiping USD 2.4 billion off its market value after the search engine giant’s founder was not spotted at the meeting.

These market moves, in their own ways seismic in nature, come against truly seismic geopolitical developments around America’s ties with Europe and President Donald Trump’s role in brokering a truce between Ukraine and Russia with Russian President Vladimir Putin.

A peace deal – even a ‘dirty deal that clearly favors Russia’, in the words of Danske Bank – may boost risk appetite, and weigh on the dollar and oil in the short term. But the wider implications of a fracturing of 80 years of solid US-European relations since World War Two could raise risk premia across markets in the long term.

Here are key developments that could provide more direction to Asian markets on Tuesday:

– Australian interest rate decision

– Singapore budget (fiscal year 2025)

– Hong Kong unemployment (January)

(By Jamie McGeever)

Dollar on track for weekly loss against euro as tariffs delayed

NEW YORK – The dollar was on track for a weekly loss against the euro on Friday as a delay in the introduction of trade tariffs planned by US President Donald Trump raised hopes that they may not be as bad as feared, while optimism about a peace deal between Russia and Ukraine helped the single currency rally.

The dollar index also fell to a nine-week low after data showed that retail sales fell more than expected in January, leading traders to raise bets that the Federal Reserve may cut rates two times this year.

“Markets are still hoping that tariff headwinds are not going to be as significant as perhaps previously feared, then probably the bigger element this week is enthusiasm about potential Russia-Ukraine ceasefire and to what extent that might be positive for European growth in particular,” said Vassili Serebriakov, an FX strategist at UBS in New York.

“The retail sales are probably a tertiary factor, but it’s kept the dollar on the back foot,” Serebriakov said.

The euro rose 0.32% to USD 1.0497 and got as high as USD 1.0514, the highest since January 27. It is on pace for a weekly gain of 1.7%.

The Japanese yen strengthened 0.37% against the greenback to 152.22 per dollar.

The dollar index was last down 0.35% at 106.72 and on track for a weekly loss of 1.3%. It reached 106.56, the lowest since December 12.

Trump on Thursday tasked his economics team with devising plans for reciprocal tariffs on every country that taxes US imports. Howard Lutnick, Trump’s pick for commerce secretary, said the administration would address each affected country one by one and said studies on the issue would be completed by April 1.

The broad announcement appeared designed at least in part to trigger talks with other countries, with a White House official saying Trump would gladly lower tariffs if other countries lowered theirs.

US Treasury Secretary Scott Bessent also said on Friday that the Trump administration is looking beyond tariffs and non-tariff barriers to examine currency manipulation as it studies the issue.

Analysts say that tariffs could add to inflation, keeping the dollar higher as the Fed holds rates higher for longer.

Trump also said on Friday he plans to impose tariffs on imported cars around April 2.

The euro and other European currencies have been supported this week by optimism that Russia and Ukraine will reach a peace deal.

Trump discussed the war in Ukraine on Wednesday in phone calls with Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskiy.

Friday’s retail sales data, meanwhile, comes after Thursday’s producer price report for January pointed towards lower than previously thought core Personal Consumption Expenditures Price Index later this month, which is the Fed’s preferred inflation measure.

Futures traders are now pricing in 41 basis points of cuts for the year, fully reversing a move towards reduced rate cut expectations after consumer price data came in hotter than expected on Wednesday.

In cryptocurrencies, bitcoin gained 1.32% to USD 97,781.23.

(Editing by Toby Chopra; editing by Diane Craft)

US yields retreat after weak retail sales data

NEW YORK – US Treasury yields fell on Friday after data showed retail sales in the world’s largest economy tumbled in January, keeping the Federal Reserve on track to cut interest rates later this year.

The benchmark 10-year yield slid 5.6 basis points to 4.469%, declining for a third straight week. Over the last two days, the 10-year yield has fallen nearly 17 bps. US 30-year yields also eased, down 3.4 bps at 4.693%.

The two-year yield, which reflects interest rate expectations, declined 5.4 bps to 4.257%. On the week, however, it was up 3.2 bps.

US yields retreated after data showed retail sales dropped 0.9% last month after an upwardly revised 0.7% increase in December. Economists polled by Reuters had forecast retail sales, which are mostly goods and not adjusted for inflation, would dip 0.1%.

US import prices also showed a favorable inflation trend, rising 0.3% in January, which was slightly less than expected after an upwardly revised 0.2% gain in December. The surge in the cost of fuels was partially offset by declines in the prices of motor vehicles and consumer goods.

Overall, Andy Wells, chief investment officer of investment management firm SanJac Alpha LP in Houston believes the secular inflation environment will remain elevated although growth will slow a little bit.

“We’re kind of having a stagflation backdrop, not scary stagflation, just saying that growth is going to be slower, and the lower end of inflation will be a little higher than what we’re accustomed to,” said Wells.

“What that means is that rates will drift a little bit higher on the long end of the curve, but on the short end, it will be rangebound. The two-year we see that as rangebound.”

Earlier this week, data showed both consumer prices and producer price indexes both exceeded estimates, reinforcing expectations of one rate cut this year.

Following the retail sales data, US rate futures priced in 41 bps of easing this year, compared with 33 bps late Thursday, according to LSEG calculations. The next rate reduction is expected either at the Fed’s September or October policy meeting.

The yield curve, meanwhile, slightly reduced its steepness on Friday, with the spread between two-year and 10-year yields at 21.5 bps, compared with 22 late Thursday.

Analysts said this was likely a retracement of the steepening trend – in which yields on the long end of the curve are higher than those on the front end – that has been going on since the Fed launched its easing cycle in September.

Steepeners remain a popular trade in the bond market with the Fed being in a rate-cutting phase and the short end of the curve tethered to rate policy moves. The strategy involves buying short-dated Treasuries and reducing longer-dated exposure.

(Reporting by Gertrude Chavez-Dreyfuss; Editing by Alex Richardson, Nia Williams and Nick Zieminski)

Fund managers boost exposure to bitcoin ETFs, quarterly US filings show

Asset managers, ranging from wealth management companies to hedge funds and pension funds, boosted allocations to US exchange-traded funds tied to the price of bitcoin in the fourth quarter of 2024, as the price of the world’s largest cryptocurrency soared 47%, according to recent regulatory filings.

The State of Wisconsin Investment Board disclosed in its quarterly 13-F filings with the Securities and Exchange Commission that its bitcoin ETF holdings more than doubled in the final three months of last year, to 6 million shares of the iShares Bitcoin Trust ETF by December 31. The fund, which was the first fund of its kind to report investing in crypto following the debut of bitcoin ETFs, couldn’t immediately be reached for comment.

Other large investment funds also boosted their holdings in the ETFs, which launched in January 2024.

Tudor Investment Corp, a systematic hedge fund manager, reported its holdings of the iShares ETF — now the largest of the pack, with more than USD 55 billion in assets — climbed to 8 million shares, from 4.4 million shares. The value of those holdings also soared, reflecting bitcoin’s jump in value, hitting USD 426.9 million, up from USD 159.9 million at the end of September. Tudor didn’t immediately respond to a request for comment.

An Abu Dhabi sovereign wealth fund, Mubadala Investment Co, reported its first foray into bitcoin ETFs in the fourth quarter, taking a 8.2 million share stake in the iShares ETF that was worth USD 436.9 million.

Hedge fund Hunting Hill Capital had no exposure to these ETFs as of the end of the third quarter, but by December 31 had re-emerged as a significant investor, with positions valued at about USD 131 million by the end of the year.

“We’ve been actively trading within the broader crypto ETF complex, and the timing of the third-quarter filing may not have aligned with when we bought and sold various ETFs,” said Adam Guren, founder and chief investment officer of the firm.

The ranks of those adding to positions included financial advisory firms whose clients have been eager buyers of bitcoin ETFs. Cetera Advisors and NewEdge Advisers were among firms that boosted holdings in several of the ETFs, including products offered by Fidelity, ARK Investments and Invesco.

Other investors were more selective, the filings showed. Cresset Asset Management boosted its exposure to ETFs carrying lower fees, said Jack Ablin, the firm’s chief investment officer.

“It’s also possible right now to get attractive options pricing for collar strategies, allowing us to protect the downside while giving away less of the upside in exchange, on these bitcoin funds,” Ablin said.

The 13F filings are one of the few ways to get insight into how institutional investors are positioned at the end of every quarter. The positions may not reflect current holdings.

(Reporting by Suzanne McGee; Editing by Leslie Adler)

Oil settles lower, supply worries ease on hopes for Ukraine peace deal

NEW YORK – Oil prices settled down on Friday on prospects for a peace deal between Russia and Ukraine that could ease global supply disruptions by ending sanctions against Moscow, but losses were limited by a delay in US immediate reciprocal tariffs.

Brent futures settled down 28 cents, or 0.37%, at USD 74.74 a barrel. US West Texas Intermediate (WTI) crude fell 55 cents, or 0.77%, to USD 70.74.

For the week, Brent gained 0.11% while WTI lost around 0.37%.

President Donald Trump ordered US officials this week to begin talks on ending the war in Ukraine after Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskiy expressed a desire for peace in separate phone calls with him.

Lifting sanctions on Moscow in the event of a peace deal should boost global energy supplies.

Russian oil exports could be sustained if workarounds to the latest US sanctions package are found, the International Energy Agency (IEA) said in its latest oil market report.

This week, Trump ordered commerce and economic officials to study reciprocal tariffs against countries that place tariffs on US goods and to return their recommendations by April 1.

“Positive development on the trade front in light of US tariff delays paves the way for some recovery in oil prices this morning, as the risk environment warms up to the prospects of further trade consensus being reached,” said IG market strategist Yeap Jun Rong.

Also limiting the losses, US Treasury Secretary Scott Bessent said in an interview that the US could apply maximum economic pressure on Iran.

Trump had driven Iran’s oil exports to near zero during his first term after reimposing sanctions.

Global oil demand has surged to 103.4 million barrels per day (bpd), up by 1.4 million bpd from the prior year, JPMorgan analysts said on Friday.

“Initially sluggish demand for mobility and heating fuels picked up in the second week of February, suggesting the gap between actual and projected demand will soon narrow,” the bank said.

US energy firms this week added oil and natural gas rigs for a third week in a row for the first time since December 2023, energy services firm Baker Hughes said in its closely followed report on Friday.

The oil and gas rig count, an early indicator of future output, rose by two to 588 in the week to February 14.

(Reporting by Nicole Jao, Paul Carsten, Sudarshan Varadhan and Jeslyn Lerh; Editing by David Goodman, David Evans and David Gregorio)

Goldman Sachs raises 12-month STOXX 600 forecast on Russia-Ukraine peace deal potential

Goldman Sachs raised its 12-month price forecast for Europe’s STOXX 600 index on Friday, citing the potential benefits of a peace deal between Russia and Ukraine for the region’s equities.

The brokerage raised its forecast to 580 from 540.

“For European equities, we see a number of potential benefits – lower risk premium, lower inflation, improved consumer confidence, stronger economic growth,” said Goldman Sachs strategists led by Sharon Bell.

US President Donald Trump held separate discussions on Wednesday with Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskiy, instructing US officials to begin talks aimed at ending the nearly three-year-long conflict.

“The potential for peace in Ukraine is clearly a catalyst for reduced risk,” Bell said.

European stocks are trading at a discount to their US counterparts, with the STOXX 600’s price-to-earnings ratio at 17.52, compared with the S&P 500’s 27.38.

Since the Russia-Ukraine war, Europe has faced challenges due to its energy dependence on Russia, with sanctions from the West reducing supply and leading to price hikes across the region.

European equities have seen significant outflows since Russia’s full-scale invasion of Ukraine in February 2022, Goldman Sachs’ Bell said.

Goldman Sachs estimates that euro zone’s economic growth could potentially increase by 0.2% in a limited ceasefire scenario.

The brokerage also raised its 12-month forecast for UK’s benchmark FTSE 100 index to 9,000 from 8,600.

(Reporting by Kanchana Chakravarty in Bengaluru; Editing by Sherry Jacob-Phillips)

Walmart to shed light on consumer health as inflation bites, tariffs swirl

NEW YORK – Walmart’s quarterly report this week will give investors fresh insight into the health of US consumers, who are facing stronger inflation and uncertainty over whether President Donald Trump’s tariffs will push up prices.

The benchmark S&P 500 stock index was up about 1% for the week, with stocks showing resilience despite a hot report on consumer prices that led investors to push back expectations of further interest rate cuts this year.

Wall Street closely watches trends in consumer spending, which accounts for more than two-thirds of US economic activity. The extent to which inflation is weighing on shopping behavior could become more evident with Thursday’s earnings report from retailer Walmart.

“Walmart is sort of a canary in the coal mine as far as consumer spending and consumer health is concerned,” said Robert Pavlik, senior portfolio manager at Dakota Wealth.

Walmart’s report could show “how much of higher food prices and higher gasoline or energy prices is digging into the discretionary spending of consumers,” Pavlik said.

The S&P 500 has climbed more than 3% this year, with broad gains among sectors. Investors have digested a flurry of policy announcements from the Trump administration, including on tariffs and federal government cost cuts, and more recently, discouraging data on inflation.

Stocks sold off modestly on Wednesday after a report showed consumer prices in January jumped by the most in nearly 1-1/2 years, with Americans facing higher costs for a range of goods and services.

The CPI data came on the heels of a survey that revealed US consumer sentiment sank in February to a seven-month low as inflation expectations soared. Households feared it may be too late to avoid the negative effects from Trump’s threatened tariffs, according to the survey’s director.

Company executives are grappling with the potential fallout from tariffs. Since the beginning of the year, nearly 430 companies in the S&P 1500 have either mentioned tariffs or responded to a question about tariffs on earnings calls or at investor events, according to LSEG data.

WALMART IN FOCUS

Walmart, as the most important consumer company in the country along with Amazon, will be closely watched for its commentary, said Matt Maley, chief market strategist at Miller Tabak.

“It’s not just what their numbers are and their guidance, but what they say about the consumer,” Maley said.

Walmart’s comments could help address whether people are “so worried about tariffs that they’re starting to question some of their spending,” Maley said.

A Walmart spokesperson declined to comment, saying the company was in a quiet period ahead of its earnings report.

Walmart’s report will be followed by results in the next few weeks from a range of consumer companies, including home improvement company Home Depot, off-price retailer TJX Cos and Target, that will also wind down fourth-quarter reporting season for corporate America.

With nearly three-fourths of index companies having reported, S&P 500 earnings are on track to have climbed 15.2% from the year-earlier period, its strongest pace in three years, according to LSEG IBES data.

Still, expectations for S&P 500 profits in 2025 have moderated since the start of the year, which some investors said has undercut optimism from the fourth-quarter reports.

The potential impact from import tariffs – which are expected to weigh on profits and drive up inflation – is poised to remain prominent on Wall Street’s radar in the coming week. Trump has announced a 10% tariff on China and a broad duty on steel and aluminum imports, while delaying tariffs on Mexico and Canada.

“No one’s quite sure what’s a negotiation and what’s the policy,” said Rick Meckler, partner at Cherry Lane Investments. Hedge funds and other large investors, he said, “don’t want to be caught short only to see a reversal in policy that causes the market to come right back.”

(Reporting by Lewis Krauskopf; additional reporting by David Gaffen; editing by Rod Nickel)

Gold rises as concerns grow over Trump’s tariff plans

Gold prices rose on Thursday as US President Donald Trump unveiled plans to impose reciprocal tariffs on countries taxing US imports, heightening global trade concerns.

Spot gold added 0.4% to USD 2,915.76 per ounce as of 01:41 p.m. ET (1841 GMT), moving back towards its record peak of USD 2,942.70 hit on Tuesday. US gold futures settled 0.6% higher at USD 2,945.40.

Trump unveiled a roadmap on Thursday for charging reciprocal tariffs on every country that imposes duties on US imports.

US producer prices in January increased solidly, providing further evidence of rising inflation and bolstering financial market expectations that the Federal Reserve will hold off on any rate cuts until the second half of the year.

“The major factor is political uncertainty and the economic consequences … the PPI was pretty much neutral and it didn’t really have much of an effect on gold, investors around the world are worried about what the Trump policies will do to the overall economy,” said Jeffrey Christian, managing partner of CPM Group.

Federal Reserve Chair Jerome Powell, at his second congressional hearing this week, reiterated that the central bank was in no rush to cut interest rates.

Despite expectations of a market selloff due to recent PPI data, Powell’s testimony, and Trump’s talk about possible Russia-Ukraine peace, the market remains positive due to a flight to safety and traders buying the dip, contradicting these bearish signals, said Bob Haberkorn, senior market strategist at RJO Futures.

Bullion is seen as a hedge against inflation and economic uncertainties, but higher interest rates tarnish the non-yielding asset’s allure.

The dollar index fell 0.5%, making greenback-priced gold less expensive for foreign buyers.

Gold is rising across all major currencies, and the dollar’s slight decline today is providing more room for its strength, Haberkorn said.

A stellar rally that has lifted global gold prices to all-time highs has cast a shadow on jewellery purchases for India’s wedding season, while dealers in China offered discounts to lure buyers.

Spot silver fell 0.2% to USD 32.15 per ounce. Platinum was down 0.1% to USD 991.25 and palladium was up 1.6% to USD 989.50.

(Reporting by Anmol Choubey in Bengaluru; Editing by Rod Nickel and Mohammed Safi Shamsi)

Oil settles flat, pares early losses as tariffs delayed

HOUSTON – Oil prices settled flat on Thursday, paring early losses of more than 1% as US tariff announcements were delayed until at least April, feeding hope that the world could avoid a trade war that would pressure economies and energy demand.

Brent crude futures settled at USD 75.02 a barrel, down 16 cents, or 0.21%. US West Texas Intermediate crude (WTI) finished down 8 cents, or 0.11%, at USD 71.29 a barrel.

Prices had tumbled earlier as a potential peace deal between Russia and Ukraine kept traders concerned that an end of sanctions on Moscow could boost global energy supplies.

US President Donald Trump ordered commerce and economics officials to study reciprocal tariffs against countries that place tariffs on US goods. Their recommendations are not due until April 1, allowing more time for negotiations with trading partners, market participants said.

“We saw a big recovery in prices on tariffs not going into effect until April,” said Phil Flynn, senior analyst with Price Futures Group. “That will allow time for negotiation.”

On Wednesday, Brent and WTI fell more than 2% after Trump said Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskiy expressed a desire for peace in separate phone calls with him. Trump ordered US officials to begin talks on ending the war in Ukraine.

The oil price decline over the past 24 hours looks to be driven by a change from worries about tight supplies to concern about sufficient supply, said UBS analyst Giovanni Staunovo, adding that some expect an increase in Russian energy exports.

Russian oil exports could be sustained if workarounds to the latest US sanctions package are found, after Russian crude production rose slightly last month, the International Energy Agency (IEA) said in its latest oil market report.

The Ukraine news and Wednesday’s US oil inventories data offset higher US inflation numbers that could drive the Federal Reserve to take a cautious approach to interest rate cuts in 2025, said PVM analyst John Evans.

Russia is the world’s third-largest oil producer and sanctions imposed on its crude exports after its invasion of Ukraine nearly three years ago have supported higher prices.

ANZ analysts said on Thursday that oil prices declined on news of the potential peace talks because of “optimism that risks to crude oil supplies would ease”, pointing to the US and EU sanctions.

A build in crude oil inventories in the United States, the world’s biggest crude consumer, also weighed on the market. US crude stocks rose more than expected last week, data from the Energy Information Administration (EIA) showed on Wednesday.

(Reporting by Erwin Seba, Enes Tunagur, Anna Hirtenstein, Emily Chow; Editing by David Goodman, Kirsten Donovan, Marguerita Choy, and David Gregorio)

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