Another major investment bank has revised down its outlook for gold's future price. Recently, Citigroup publicly expressed a bearish view on gold in the near term, forecasting that gold prices could reach $4300 per ounce over the next zero to three months. This marks the fourth major international investment bank to change its stance on gold and is currently the most aggressive in its downward revision.
Citigroup's concerns are grounded in practical considerations: should a cooperative agreement between the U.S. and Iran be successfully reached, leading to the full restoration of shipping order in the Strait of Hormuz, international oil prices could return to pre-conflict levels. This would likely cause market inflation sentiment to weaken rapidly. If the pace of nominal interest rate cuts lags behind the decline in inflation, real interest rates would rise accordingly, thereby putting downward pressure on gold prices. Citigroup has set a gold price target of $4300 per ounce for the 0 to 3-month period, noting that prices could fall significantly below this level in the event of a major risk-off event.
Gold reached a high of $5598.75 per ounce in late January this year before entering a prolonged period of adjustment. Although there have been some rebounds, the overall trend has been downward.
As gold entered this correction phase, institutions began to lower their price expectations. Shortly before Citigroup's revision, JPMorgan Chase also reduced its average gold price forecast for 2026 from $5708 per ounce to $5243 per ounce, citing weakening short-term demand as investor client interest has "dried up to a trickle."
Analysts from the bank stated in a report released on Sunday: "This quiet period is reflected in stagnant trading activity and demand indicators. Total open interest and trading volume in COMEX gold futures remain persistently low, managed money net futures positions are hovering near lows, and ETF inflows are also tepid."
The first major bank to initiate a downgrade was Morgan Stanley, which at the end of April had already lowered its latest gold price target for the second half of 2026 to $5200 per ounce, significantly below the previous expectation of $5700 per ounce, marking a substantial revision.
Morgan Stanley's rationale was: geopolitical friction has led to rising real interest rates and delayed Federal Reserve rate cuts, fundamentally altering the macroeconomic landscape. Gold typically strengthens in a declining interest rate environment, but persistently high current rates have broken the traditional price logic, prompting investors to reposition. Consequently, the situation has reversed: high real interest rates make bonds more attractive, significantly reducing the appeal of non-yielding gold. Morgan Stanley emphasized that this change has restored the classic negative correlation between gold and real interest rates to normalcy—a relationship that had weakened considerably during gold's surge from 2025 to early 2026 but has now seen its linkage return to high levels.
Simultaneously, central bank operations have also pressured gold prices. Central banks in several emerging markets, including Turkey, have begun selling gold reserves, further weighing on prices. Additionally, gold ETFs have shifted to net outflows, with investors who previously bought heavily exiting quickly, accelerating the decline in gold prices.
Subsequently, ANZ also lowered its year-end gold price target from $5800 per ounce to $5600 per ounce, delaying the projected time for gold to reach $6000 from early 2027 to mid-2027.
ANZ analysts noted: "The market currently appears caught in a dilemma between geopolitical anxiety on one hand and concerns over rising inflation on the other." Meanwhile, physical gold demand may also face risks, as the Indian Prime Minister has called on citizens to refrain from purchasing gold over the next year to help safeguard the country's foreign exchange reserves.
However, despite the bearish near-term outlook, more major banks believe that the fundamental logic of the gold bull market remains intact, and the probability of gold rising in the medium to long term is still high.
Goldman Sachs maintains its bullish view on gold, predicting that gold will resume its upward trend by the end of 2026.
Analysts Lina Thomas and Daan Struyven stated in a report that gold's medium-term prospects remain solid. Due to continued central bank purchases and expectations of two more U.S. rate cuts this year, gold prices could reach $5400 per ounce.
Wells Fargo offers a bolder prediction of $8000 per ounce for gold, primarily based on currency depreciation. Wells Fargo points out that the global economy has entered the fourth "cycle of currency debasement," with rising debt, deficits, and inflation eroding the value of fiat currencies like the U.S. dollar. During such periods, investors often seek safe havens outside the traditional system; historically, gold has been the best place to preserve wealth.
Canadian mining legend Pierre Lassonde, former President of Newmont Mining, predicts that gold prices could reach $17250 per ounce as gold replaces the dollar as the ultimate reserve currency.
Lassonde stated that today's extreme leverage makes the current economic cycle more volatile. In the late 1970s, gold prices increased tenfold as inflation and interest rates rose in tandem. Now, the massive U.S. sovereign debt must also be considered.
As of early May 2026, total U.S. national debt approached $39 trillion. Rising borrowing costs exacerbate this debt burden, with the Congressional Budget Office projecting that net interest payments will account for nearly 14% of federal spending this fiscal year.
Lassonde believes the Federal Reserve is monetizing the debt, providing a persistent tailwind for gold. He is confident that the $17250 per ounce gold price target is not fanciful and expects the market to see it achieved within three years.
Joni Teves, a metals strategist at UBS in Singapore, also stated that the institution remains firmly bullish on gold. She recently said: "We believe gold prices can recover from current levels and set new highs within the year."
UBS's current gold price target is set at $5600 per ounce, with potential to reach $6000 per ounce, further raised from the $5400 per ounce target at the beginning of 2025.
Regardless of gold's future trajectory, this bull market has already created business opportunities for many companies.
According to reports, SF Holding plans to open a gold vault in Hong Kong to meet storage demand arising from Hong Kong's push to develop as a precious metals hub.
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