Gold is emerging as the preferred safe-haven asset for banking giant Goldman Sachs, even as volatility grips other precious metals.
In a new episode of Goldman Sachs’s This Is the Market’s podcast, senior commodities analyst Lina Thomas says the bank is picking gold over silver.
Thomas says that silver’s tighter liquidity can amplify price swings, making it harder for some investors to tolerate sharp moves. Gold, by contrast, benefits from steadier demand from central banks and large institutional buyers.
“We have a stronger conviction in gold simply because this liquidity squeeze that we’re seeing in silver is something that creates extreme volatility, extreme price action. And not everybody can stomach that type of volatility. And on top of that, gold still has a structural demand bit from these central banks, typically a little bit more structural demand also from institutional investors looking to buy gold. So we definitely prefer gold over silver.”
Morgan Stanley is also bullish on gold, flagging longer-term drivers behind gold’s rise.
In a recent video update, Wealth Management Chief Investment Officer Lisa Shalett outlines the three forces that could push the price of gold to greater heights.
“With gold, for example, a secular growth story may be emerging. After Ukraine was invaded in 2022 and sanctions were imposed on Russia, central banks stepped up the pace of diversifying their foreign currency reserves, buying gold, and reducing their U.S. dollar holdings significantly. U.S. strategies around global trade have helped fuel this move. Meanwhile, digital asset and stablecoin issuers have been purchasing gold as they look for non-dollar collateral for new products. And finally, our ever-increasing debt and deficits in the US and elsewhere have raised concerns over currency debasement, leading more investors to gold.”
At time of publishing, gold is valued at $5,042.
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