Citigroup: Half of the risks supporting gold may fade later this year

Odaily Citigroup stated on Friday that gold investment allocations are supported by a series of intertwined geopolitical and economic risks, but about half of these risks may fade later this year.

Citibank noted that some core risk factors supporting gold demand—including concerns over U.S. government debt and AI uncertainty—could keep gold prices at levels higher than historical averages.

However, the bank estimates that most of the risks currently priced into gold will not truly materialize by 2026, or even if they do, they will not sustain beyond 2026. The bank added: "We see the Trump administration working to achieve 'American-style gold stability' during the 2026 midterm elections, and we also see the Russia-Ukraine conflict coming to an end, with the Iran situation ultimately easing as well. All of these would imply a reduction in risk relative to current levels. If Wash's nomination is approved, it would further confirm our long-held view that the Fed maintains its political independence. This view, in turn, is another medium-term negative factor affecting gold prices." (Jin10)