Analysts at Citigroup upped their 2021 gold value forecast, citing “we carry the 2021E base case gold value forecast by ~$300/oz, versus our early July replace, to a document $2,275/oz.”
Key quotes
“Preserve our 0-3m point-price goal at $2,200/ouncesand a 6-12m goal at $2,400/oz.
Occasional liquidation squeezes, drawdowns, and profit-taking exercise for gold appear doubtless in a excessive volatility market atmosphere. However traders will most likely purchase that dip on the again of an accommodative central financial institution response perform.
Document weak gold jewellery consumption and tepid official sector gold demand might restrict the efficiency of gold
The document tempo of inflows and total progress in bullion ETF holdings displays sturdy investor urge for food for gold.
Larger inclusion of gold by portfolio asset allocators, particularly non-traditional gamers (e.g., pensions, insurance coverage, household places of work), is an extra tailwind for the bullish gold thesis within the medium-term.
Present Fed coverage and liquidity provisions have additionally tempered issues about one other sharp collapse in inflation expectations. So the general gold value development ought to, on stability, stay upward sloping within the present regime.”
