Gold is glittering brighter than ever, with its price climbing $8 to $3,380 per ounce, and experts at Citi are betting it’s headed even higher. The bank recently raised its three-month gold price forecast to $3,500 per ounce, up from $3,300, projecting a trading range of $3,300–$3,600. This bullish outlook comes as the U.S. economy faces mounting challenges, making gold an attractive safe-haven for investors.
Why the Surge?
Citi points to a worsening economic picture in the U.S. as the main driver behind gold’s rise. New tariffs imposed by President Donald Trump on countries like Canada, Brazil, India, and Taiwan are expected to fuel inflation, pushing prices higher across the board. At the same time, recent labor market data paints a grim picture, with only 73,000 new jobs added in July—far below expectations—following a downward revision for June. This weak jobs report has sparked hope for a Federal Reserve interest rate cut in September, with an 81% chance according to the CME FedWatch tool. Lower interest rates typically weaken the dollar, which boosts gold prices since the metal is priced in dollars.
Beyond economics, concerns about the Federal Reserve’s independence and the reliability of U.S. economic data are adding fuel to gold’s fire. These uncertainties make investors nervous, driving them toward gold as a hedge against instability. Citi notes that gold demand has already surged by over 30% since mid-2022, driven by strong investor interest, central bank purchases, and steady jewelry demand despite sky-high prices.
From Steady to Skyrocketing
For the past few months, Citi’s gold price forecasts bounced between $3,150 and $3,500, reflecting a stable but range-bound market. However, recent developments have shifted their view to a “bullish breakout.” They now expect gold to hit new all-time highs within the next three months, breaking out of its previous trading range. On Monday, spot gold dipped slightly by 0.1% to $3,360.20 per ounce as some investors cashed in profits after a 2% jump the previous Friday. Meanwhile, U.S. gold futures climbed 0.4% to $3,412.31, signaling continued optimism.
Why Gold Matters
Gold has long been a go-to asset during times of economic or geopolitical stress. Its value tends to rise when confidence in traditional investments, like stocks or bonds, falters. With U.S. growth slowing, inflation risks rising, and global trade tensions heating up, gold’s appeal is stronger than ever. Whether it’s central banks stocking up or everyday investors seeking stability, the precious metal is shining as a reliable store of value.
What’s Next?
Citi’s analysts are confident that gold’s upward trajectory will continue, driven by a weaker dollar, potential rate cuts, and ongoing economic uncertainty. As the U.S. navigates a tricky second half of 2025, gold could solidify its place as a must-have asset for investors looking to weather the storm.
For those interested in diving deeper into market trends, platforms like eFX Plus offer trade ideas and insights, with a 7-day free trial available for new users. As gold continues its climb, all eyes will be on whether it hits Citi’s $3,500 target—or soars even higher.
