Goldman Sachs lowers gold forecast to $930/oz

LONDON, March 25 (Reuters) - U.S. bank Goldman Sachs (GS.N: Quote) said on Wednesday it has cut its gold price forecast to $930 an ounce in the next six months because of an expected reduction in buying by gold-backed exchange-traded funds.

In February, Goldman raised its gold price forecast to $950 an ounce in the next 6 months.

"Should real interest rates move lower or buying by gold-ETFs continue at its current torrid pace, however, the upside risk to prices would be significant, the bank said in a note.

"(Data) suggests that higher real interest rates increase the rate of gold mine production while lower real interest rates slow the rate of mine production."

Goldman expects gold prices to rise to $962 an ounce on a 12-month horizon.

Spot gold XAU= was at $932.70/934.70 an ounce by 1628 GMT on Wednesday from $925.65 late in New York on Tuesday, but well below the 11 month high of $1,005.40 reached on Feb 20.

Holdings of gold ETFs surged in recent months as equity prices crashed and worries over the economy persist, spurring demand for bullion as a safe-haven asset.

The world's largest gold-backed exchange-traded fund, the SPDR Gold Trust (GLD: Quote), said holdings rose to 1,124.99 tonnes as of March 24, up 10.7 tonnes from the previous day. (Reporting by Paul Lauener; editing by Keiron Henderson)