There are always conflicting opinions as to how specific assets and markets will perform in the near future. Citibank analysts seemingly have very high expectations for the gold price, expecting it to rise in value rather significantly.
Citibank Analysts Weigh in on Gold
Various experts have shared their expectations for the gold market over the coming weeks and months. In most cases, the overall sentiment is very bullish, indicating how a new all-time high price may be reached in 2020. Based on the current global financial circumstances, that seems more than likely to come true.
It now appears that even Citibank analysts expect big things to happen in the coming months. Their new gold price forecast projects a value of $1,700 per ounce in the next three months. Looking ahead even further, a price of $1,900 per ounce in the next six to twelve months seems plausible.
A rising XAU/USD value can reshape the future of money as people know it today. There have been rumors and debates about potentially reinstating the gold standard. That decision has not been finalized in an official capacity, yet it does open the door for future prospects.
Ongoing Actions Warrant Higher Values
The Citibank analysts point at several factors potentially influencing the gold price in the next few months. SME lending, for example, has been one of the many measures introduced by the Federal Reserve. However, it will take a few weeks before it will even kick in,
That delay in SME lending will have an impact on the US Dollar. More specifically, the liquidity of the greenback will be affected, increasing the perceived value of the US Dollar and potentially reducing the appeal of gold and other precious metals.
At the same time, the rising unemployment rate is something to be concerned about. As of right now, that rate sits at 4.4%, beating expectations, but not for the right reasons. To counter the risk posed by rising unemployment, investors flocked to gold once again.
As the coronavirus crisis continues to weigh on society, the same factors will remain in place. Unemployment in the US is likely to keep increasing for some time to come. Assuming investors maintain their risk-averse strategy, a gold price push to over $1,700 is not unlikely.