According to the gold price forecast of multinational financial services group Citigroup (commonly known as Citi), the gold price fever is at its peak, and prices may decrease by 25% by the end of 2026.
At 9:30 a.m. on June 21, the world gold price was listed around 3,367.1 USD/ounce, up 10.2 USD compared to 1 day ago.
World gold prices this year have approached a historical peak, not only in USD but also adjusted according to inflation. However, according to the latest quarterly market report from Citi's global commodity analysis team, this golden period may be coming to an end.
The forecast, led by Maximilian Layton - Citi's global commodity director - said gold prices could fall to $2,500-2,700/ounce by the end of 2026. This means a decrease of about 25% compared to the current high price level.
According to Citi's analysis, the world is currently spending about 0.5% of GDP on gold, the highest rate in 50 years.
Demand for investment and gold reserves has reached its peak, the report said, adding that many drivers of a skyrocketing gold price in the post-pandemic period, such as inflation concerns, global political instability and trade tensions, are gradually easing.
Citi forecasts that investment demand for gold will weaken by the end of 2025 and in 2026, as the US political and economic landscape becomes more stable. The report mentions the effect of President Trump and US economic growth as a factor that could soothe the defensive sentiment of global investors.
In addition, Citi also does not believe that the US bond market will have a big shock in interest rates in the long term, which is a factor that often causes investors to turn to gold as a safe haven.
The current difference in BBB bonds is largely compensated by tax revenue, the analysis team wrote, implying that public debt risks have not reached the level of causing market panics.
BBB bonds are the type of bond that credit rating institutions (such as S&P, Moody's or Fitch) evaluate as the lowest in the "safe investment grade" group.
According to Citi's calculation, every time interest rates fall by 100 basis points, gold prices will automatically fall by about 200 USD/ounce. With expectations that the US Federal Reserve (Fed) will abandon tighten monetary policy in the coming time and move to a more neutral stance, the global growth outlook will improve and demand for gold will weaken significantly.
Notably, the current gold price no longer reflects the mining costs as before. High-cost gold mining companies are now still achieving a profit margin of up to 100%, showing that prices have far exceeded the actual production value.
If Citi's forecast is true, 2026 could mark an important turning point in gold's more than 20-year rally.
In the Vietnamese market, as of 9:30 a.m. on June 21, the price of SJC gold bars was listed by Saigon Jewelry Company at 117.7 crore (buy in - sell out), an increase of VND300,000/tael in both directions.
At the same time, the price of SJC gold bars was listed by DOJI Group at 117.5-119 seven million VND/tael (buy in - sell out), an increase of 300,000 VND/tael in both directions.
