Citigroup: There is still room for growth in gold and silver. Geographic and macroeconomic developments will restore demand for precious metals investment

Comparing the news, Citigroup Research said it believes that the upward trade in precious metals is not over yet, and that silver will continue to follow the direction of gold and become a more aggressive upward expression due to higher volatility and elasticity. If the situation in the Strait of Hormuz finally cools down and the Federal Reserve's position becomes less hawkish, demand for precious metals investment will continue to recover.

Recent market conditions have provided a background for this judgment. The settlement price of COMEX August gold futures rose 0.49% to 4,383 US dollars/ounce; silver futures fell 0.5% to 64.769 US dollars/ounce on the same day, ending two days of continuous gains. Citi believes that the short-term pullback will not change the position of silver as a high-beta asset for gold. If geographical risk mitigates and pushes capital back into precious metals, silver will have a chance to rise to 95 US dollars/ounce in 2027.

However, Citi also retained the risk scenario. The bank believes that silver still has a 20% chance of falling to 50 US dollars/ounce, indicating that current precious metals trading is still highly dependent on interest rate expectations, dollar trends, and geographical risk. For the market, gold is still the core asset for defense and interest rate cut expectations, while silver is more suitable for expressing a flexible market after risk appetite recovers.