XAU/USD: Higher average gold prices seem likely – CitiBank


Analysts at Citibank forecast gold (XAU/USD) at $1700/oz in a 1-3 month horizon and at $1900/oz in 6 to 12 months. 

Key Quotes:

“Fed member mentions that the SME lending program may still take a couple of weeks to start, leading to tight onshore US dollar liquidity, favoring the US dollar and dragging down gold. However, nonfarm payrolls fell by 701K in March and the unemployment rate rose to 4.4%, which was worse than expectations. Money flowed into gold for risk aversion and limited the decline of gold price.”

“Gold/USD may rise toward 1704 upon consolidation, with pivot supports at 1536 and 1553.

“We think higher average gold prices seem likely with US policy rates now at the ZLB and extraordinary monetary stimulus across the G3. There is also $10Tn of negative yielding debt outstanding globally, unlike in 2008, which may reduce the opportunity cost of holding gold.”


 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!

Latest Forex News


Latest Forex News

Editors’ Picks

USD/JPY picks up the bids below 106.00 amid risk-off mood

USD/JPY struggles to carry the previous day’s declines while bouncing off the weekly low near 105.60. Deadlock over the US stimulus, Sino-American tension supersedes upbeat US data. Japanese PM’s failure to tame coronavirus (COVID-19) also fails to propel the quote.

USD/JPY News

AUD/USD: Ignores all odds to stay on the front-foot above 0.7100

AUD/USD defies the pullback from 0.7167 while picking up the bids from 0.7155. RBA stood pat with policymakers citing global outlook as “highly uncertain”. Aussie Retail Sales gained on MoM but lagged quarterly, Trade Balance softened.

AUD/USD News

Gold: Refreshes record top beyond $2,000 as risk dwindles

Gold bulls are unstoppable while taking the bids near $2,020 during the early Wednesday morning in Asia. The yellow metal pierced the $2,000 psychological magnet to refresh the record top the previous day.

Gold News

WTI ignores API draw to consolidate gains beyond $41.50

WTI seesaws around $41.65 during the initial Asian session on Wednesday. The oil benchmark has been trading in a choppy range despite notable declines in the private inventory data.  The reason could be traced from the market’s cautious sentiment that seems to take more clues from the US stimulus updates off-late.

Oil News

BTC/USD is ready for another attempt at cracking $12,000

Bitcoin has been somewhat flat in the past two days after a dip to $10,583 caused by someone placing several large orders on Binance’s quarterly futures contract. 

Read more

Forex MAJORS

Cryptocurrencies

Signatures