It’s been a mixed week for gold after dropping in the past three days, with the US-Iran war threatening to restart. All that before a bit of recovery back to $4,100 today after US president Trump said that Iran is desperate to make a deal again.
But after four months of declines and a push towards $4,000, Credit Agricole believes that there is scope for a rebound in gold prices moving forward. Their argument is based on the premise that the energy price shock fades into the background, although that risk appears to have reignited this week.
But in the bigger picture, the firm outlines that central bank demand and a returning focus on de-dollarisation should keep gold underpinned. That especially with many of the negative factors already priced in for the precious metal.
“We believe that many negatives are already in the price of gold following its recent sell-off. Central banks still see XAU as a primary tool to reduce their exposure to the USD given the attempts by the US to weaponize the currency. They could thus resume gold purchases especially if global energy shock continues to fade. Concerns about fiscal dominance over the Fed could return as well, weigh on US real rates and help XAU recover.”
This doubles down on their late June view that gold has been “one of the biggest victims from the USD’s resurgence in 2026”. They made the same argument then that “a continuation of the recent decline of energy prices could help as well as it could allow global central banks to start rebuilding their gold reserves”. And earlier in June, Credit Agricole was out noting that: “We recommend buying XAU/USD at $4,338, targeting a bounce to $5,420 in the coming quarters, with a stop-loss of $3,800.”
This article was written by fl9bde53b91e184082bbe3aa3acaaf2cb0 at investinglive.com.
