- There’s an off chance that gold prices could soar to $3,000 per ounce, and oil to $100 per barrel within the next 12 to 18 months, according to Citi.
- Central bank aggressive purchases, stagflation, and a global recession are catalysts that could drive the price of the yellow metal almost 50% higher, Citi analyst said.
Gold prices could soar to $3,000 per ounce, and oil to $100 per barrel within the next 12 to 18 months subject to any one of three possible catalysts, according to Citi.
Gold, which is currently trading at $2,016, could surge by about 50%, if central banks sharply ramp up purchases of the yellow metal, a possible stagflation, or in case of a deep global recession, Aakash Doshi, Citi’s North America head of commodities research, told CNBC.
Central bank’s gold rush
“The most likely wildcard path to $3,000/oz gold is a rapid acceleration of an existing but slow-moving trend: de-dollarization across Emerging Markets central banks that in turn leads to a crisis of confidence in the U.S. dollar,” Citi analysts including Doshi wrote in a recent note.
That could double central bank’s gold purchases, challenging jewelry consumption as the largest driver of gold demand, Doshi elaborated.