As the world’s premier investment manager and financial market journalist, I bring you the latest insights on the gold market. Despite a mixed demand landscape, Citi Global Research remains confidently bullish on gold prices, projecting a target of $2,500 per ounce in the short term and $3,000 per ounce over the next 12 months.
Demand dynamics in the gold market are shifting, with official sector purchases remaining robust and OTC investments on the rise. Central bank gold demand is expected to continue its upward trend, driven by de-dollarization and reserve diversification. Additionally, OTC demand has surged, with bullion ETF inflows picking up pace in July.
However, there are areas of concern, as gold demand in China and the jewelry sector has softened. Chinese retail demand is expected to remain weak in Q3, while jewelry demand has seen a sharp decline due to high prices and inflationary pressures.
Analysts foresee a positive outlook for gold prices, with an expected increase in physical investment demand in 2024 and 2025. This elevated level of investment demand, coupled with resilient central bank purchases and robust OTC demand, supports the projection for gold prices to reach $3,000 per ounce over the next 12 months.
In conclusion, the shifting dynamics in the gold market could mitigate the impact of weaker retail and jewelry demand. Investors should keep a close eye on these trends and consider adding gold to their portfolios for potential gains in the coming months.