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Citigroup (Citi) has warned that gold prices may be entering a bearish phase this year, amid several uncertainties expected to unfold heading into 2026.
Quoted by Reuters, Citi stated that current gold investment allocations are still supported by a broad mix of geopolitical and global economic risks. However, nearly half of these risks are expected to fade in the near future.
Citi highlighted several uncertainty factors—such as tariff wars, conflict risks, rising global government debt, and uncertainty surrounding investments in artificial intelligence (AI)—that have helped keep gold prices elevated compared to historical norms.
That said, around half of these risks are likely to ease or prove short-lived, particularly following recent political maneuvers by U.S. President Donald Trump.
Trump recently appointed former Federal Reserve Governor Kevin Warsh to lead the U.S. central bank. The nomination is seen as reinforcing the Fed’s political independence, strengthening the U.S. dollar, and putting downward pressure on gold prices.
“This confirmation further strengthens our base case that central bank independence will remain intact, which is one of the factors weighing on gold prices in the medium term,” Citi said.
In addition, signs of de-escalation in the trade war with China have emerged, while Trump continues to push for peace negotiations between Russia and Ukraine.