Citigroup Warns Gold Valuation at Extreme Levels, Foresees Significant Downturn in H2 2026

Citigroup has issued a stark warning regarding the current valuation of gold, stating that it has reached an "extreme" level. According to a report by Cailian Press, global gold expenditure as a proportion of GDP has surged to 0.7%, marking a 55-year high. The financial institution suggests that if gold's allocation ratio reverts to its historical norm of 0.35%-0.4%, the price of gold could face a "halving" risk.

This projection is underpinned by an anticipated abatement of safe-haven sentiment in the latter half of 2026. Factors contributing to this shift include the potential for a resolution to the Russia-Ukraine conflict, a strengthening U.S. economy, and the confirmation of the Federal Reserve's independence. Citigroup believes the collective dissipation of these geopolitical and economic uncertainties will remove the final pillar supporting gold's current price levels.

#crypto #blockchain #news