Gold could soar to new record high, Citigroup says

  • Gold could soar to new record high, Citigroup says

Gold could soar to new record high, Citigroup says

"The meeting could serve as a potential catalyst (for gold) and investors are already buying into the rate cut expectations", said Margaret Yang Yan, a market analyst at CMC Markets. Gold hit a record high of more than $1,900 an ounce in August 2011.

We discuss investing in gold with Euro Pacific Capital CEO Peter Schiff, U.S. Global Investors CEO and CIO Frank Holmes and VanEck's Deputy Portfolio Manager for Gold Imaru Casanova.

The U.S. Federal Reserve will continue to act "as appropriate" to sustain the economic expansion in the world's biggest economy, Fed Chair Jerome Powell said Friday in Zurich, sticking to a phrase that financial markets have read as signaling further interest-rate reductions ahead.

Given that gold has had such a deep correction from its recent peak, investors are buying on dips, Yan added.

"We think there is a probability the Fed will take the policy rate back down to zero, as global central banks converge", he says.

Hedge funds and money managers hiked their bullish positions in COMEX gold and silver contracts in the week to September 3, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.

Fundamental backdrop is still broadly gold-supportive considering the main sources of risk aversion remain unresolved, Spivak added. "That probably encourages central banks to remain dovish". -China trade war, rising geopolitical risks and increased demand are creating the ideal storm for the precious metal.

U.S. Treasury yields rose Monday, with the yield on the 10-year Treasury note up 6 basis points at 1.6114 percent.

Meanwhile, the dollar was steady against a basket of major currencies.

Spot gold still targets $1,453, as it has cleared a support at $1,497 per ounce, according to Reuters technical analyst Wang Tao.

As for other precious metals, silver for December delivery was up 4.8 cents, or 0.26 percent to close at 18.167 dollars per ounce.

Palladium jumped 1% to $1,551.48 an ounce and platinum gained 0.3% to $952.38.