economy
Gold could slump another 20% by September, says Citi
Since the outbreak of the U.S.-Iran war on Feb. 28, gold's reputation as a "safe haven" asset in times of turmoil has come under pressure.
TL;DR
- Gold prices have fallen sharply since reaching an all-time high of $5,594.82 an ounce.
- Citi analysts predict gold could sink to $3,500/oz if the Strait of Hormuz remains closed until the end of summer.
- The precious metal is considered 'incredibly high risk' in the short term, challenging its reputation as a safe haven.
- A stronger U.S. jobs report and expected interest rate hike are further pressuring gold prices.
- Citi has downgraded its 3-month price target for gold to $4,000/oz from $4,300/oz.
- The headwinds against gold are linked to the Hormuz impasse, high energy prices, high real rates, a strong dollar, and weaker emerging market activities.