An assessment from Citi about gold, whose value has reached a record level. It is said: “Global risks cause prices to rise.” The international investment organization predicts that the approval of the appointment of the new Fed Chairman will impact the decline in gold prices.
Prices are breaking record after record and investors are wondering “What will happen tomorrow?” Regarding the gold issue he questioned, Citi predicted “risks will decrease.”
Citi said in a statement that gold investments are supported by total geopolitical and economic risks, but about half of these risks could be reduced in the later part of 2026.
Citi sees issues such as US-China tensions, China-Taiwan issues, concerns about US government debt and uncertainty around artificial intelligence as among the key risks increasing gold demand and says this is likely to keep gold prices well above historical norms.
THE RISK MAY NOT LAST UNTIL THE END OF THE YEAR
However, the bank predicts that about half of the existing risks associated with gold prices will not materialize by 2026 or persist beyond that year.
“We see the Trump administration attempting to create a moderate economic environment in the United States ahead of the 2026 midterm elections, and we also view the end of the Russia-Ukraine war and the easing of tensions with Iran over time as developments that mean risks are significantly lower than today,” Citi said. he said.
Last week, due to geopolitical and economic instability, gold rose to a record level, approaching 5,600 USD/ounce.
NOTES ON THE APPOINTMENT OF THE FED CHAIRMAN
However, after US President Donald Trump nominated former Federal Reserve Chairman Kevin Warsh to head the US central bank after Fed Chairman Jerome Powell's term ended in May, the dollar rallied and gold fell 12% in one day, showing the largest daily percentage drop in history.
“Warsh's nomination, if confirmed, would further reinforce our long-standing fundamental view that the Fed maintains political independence, which would constitute another medium-term bearish factor for gold prices,” Citi said.
TO PRACTICE ALLADION
ICBC, the Industrial and Commercial Bank of China, also expressed its views on the situation of gold and precious metals. The statement said that precious metal prices have recently been “extremely volatile” in China and the world. While the bank stated that market uncertainty has increased significantly, investors are advised to assess their risk tolerance and avoid “impulse trading”.
