In its latest research report, Citigroup's commodities research team lowered its three-month target price for gold from $4,300 to $4,000 per ounce. Analysts stated that the improved macroeconomic environment and weakening demand for gold are the core reasons for this price reduction.



The research report points out: "In the short term, it is difficult for any positive factors to emerge that can drive gold prices to continue rising."

Citigroup analysts believe that multiple factors are weighing on gold prices: stabilizing real yields, a relatively strong short-term dollar, and easing geopolitical tensions have all contributed to a narrowing of gold's safe-haven premium. Meanwhile, demand for physical gold from central banks and inflows into gold ETFs have both declined, weakening the previous upward momentum for gold. Analysts suggest that unless new unforeseen risk events occur, the upside potential for gold prices in the short term will be significantly limited.

Despite the pressure on the short-term outlook for gold, Citi analysts believe that gold prices could still break through $4,000 per ounce this summer if the US economy weakens significantly or inflation rises again. The bank maintains its long-term gold price forecast of $4,500 per ounce over the next 6 to 12 months, a prediction based on the Federal Reserve shifting to an easing monetary policy or a further escalation of global geopolitical conflicts.

Since the market correction this year, Citi has repeatedly and significantly lowered its gold price forecasts. As early as January 13, a team of Citi strategists led by Hugh Kenny raised their precious metal price forecasts, increasing their target price for gold to $5,000 per ounce for the next 0 to 3 months and their target price for silver to $100 per ounce. At that time, the team judged that the bull market in precious metals would continue into the first half of 2026.

At that time, strategists raised their expectations based on three main factors: escalating global geopolitical risks, continued supply shortages in the physical metals market, and renewed concerns about the independence of the Federal Reserve's policies.

At the start of the new year, both gold and silver prices hit record highs. Citigroup maintains its view that silver will outperform gold, and believes that market focus will gradually shift towards base metals.

The strategist wrote in a research report: "We are optimistic about silver outperforming gold in the long term, and we also predict that the bull market in precious metals will gradually spread to industrial metals, which will become the main theme of the market. This logic has now been confirmed by the market."

In its January outlook, Citigroup also noted that geopolitical tensions are likely to gradually ease after the first quarter, leading to a decline in precious metal demand throughout the year, with gold prices being the most likely to experience a correction. The bank remains optimistic about the industrial metals market in the second half of 2026, particularly aluminum and copper.