Leading American bank tempers gold outlook as barnstorming run ends
Last updated: 07:00 13 May 2025 EDT, First published: 06:52 13 May 2025 EDT
After a barnstorming run that saw gold prices hit record highs in April, Citi is reining in its short-term expectations.
The bank has lowered its three-month gold price target to $3,150 per ounce, down from $3,500, and expects the precious metal to consolidate between $3,000 and $3,300 over the coming months.
In its latest Metal Matters note, Citi points to the surge in gold being driven by a “perfect storm” of factors, including safe-haven demand stoked by tariff tensions.
But with negotiations showing progress, the speculative heat may cool for now.
The bank still sees strong underlying support for gold. It highlights record global wealth allocations to the metal and a growing share of central bank reserves being parked in bullion.
However, Citi also flags some natural limits. Demand for gold jewellery is falling, and higher prices could tempt more scrap metal back into circulation, both of which could weigh on prices.
The message is clear: gold has had its run, and while the structural case remains intact, the market may need time to catch its breath. For now, Citi sees consolidation as the path of least resistance.
On Tuesday, spot gold was up around 1% at $3,256.50.
