Citibank has raised its gold price target to $3,300 per ounce, pointing to extraordinary physical demand as the main driver rather than speculative trading.
“Using our quarterly price changes model, we see gold prices rising to well over $3,300/oz, though we view this as a bull case given the potential for jewelry and scrap over the next 12 months. We take a more conservative base case… which suggests gold increases to $2,900–3,000/oz over the next 6–12 months,” said Kenny Hu, Max Layton and their team at Citi.
The bank’s analysis indicates that by late 2025, roughly 95% of current mine supply could be absorbed by investor demand, while central bank purchases remain at historically high levels. This combination of shrinking available physical supply and sustained institutional buying underpins Citi’s higher price outlook.
Other major bullion banks have similarly revised their forecasts upward, with several now targeting gold around $3,000 per ounce. Analysts attribute the change to a shift in valuation emphasis: physical demand—from investors, central banks and jewelry markets—is increasingly the dominant factor, rather than traditional drivers like a stronger dollar or changes in interest rates.
Market observers note that when physical demand outpaces mine production and recycling, price dynamics can change rapidly. Jewelry and scrap flows, seasonal buying patterns, and central bank reserve strategies all influence how much metal is available to the market. Citi’s report highlights that even modest changes in these flows could push prices toward their bull case, while the bank’s base case still sees a substantial rise to the $2,900–3,000/oz range within the next six to twelve months.
Investors interpreting these forecasts should weigh the assumptions behind them, including the pace of central bank purchases, the rate of investor accumulation, and potential increases in scrap and jewelry supply. While forecasts vary, the consensus among several large institutions points to a materially higher gold price profile driven by physical-market dynamics rather than just macroeconomic indicators.