Gold prices fall below $4,000 as analysts warn of further correction
Precious metal prices have dropped more than 30 per cent from their January peak amid inflation and interest rate concerns.
Gold prices have fallen below $4,000 an ounce, marking a decline of more than 30 per cent from the record high of $5,595 seen in January, according to a report by the Economic Times.
The downward trend comes as rising crude oil prices due to tensions regarding the Iran war stoke inflation concerns and expectations of further US Federal Reserve rate hikes.
Bank of America (BofA) expects gold to stay below $4,000 for the next three months, forecasting an average price of $4,000 in the fourth quarter.
The bank's demand tracker shows a 16.6 per cent year-on-year decline in purchases by key buyers, with Indian imports falling 77.8 per cent.
Suki Cooper, Global Head of Commodities Research at Standard Chartered Bank, noted that investment demand through gold-backed exchange-traded products (ETPs) faced outflows late last week.
Cooper stated that gold must maintain support at $3,886 an ounce to avoid a deeper correction, noting that elevated energy prices continue to impact the outlook.
