Amundi forecasts gold to reach $4,500

Lorenzo Portelli, Head of Cross Asset Strategy at the Amundi Investment Institute, stated that markets have largely priced in the worst-case scenario for gold and forecast that the precious metal could rise to approximately $4,500 per ounce. The firm's base-case scenario points to an increase of at least 10% from current levels.

Gold fell below $4,000 last week, reaching a three-month low as investors sold the precious metal to cover losses in other markets and expectations of U.S. interest rate hikes strengthened. With gold having lost approximately 10% of its value since September, Portelli suggested that reduced investor positioning could support a recovery in the coming weeks. However, Amundi acknowledged that the likelihood of gold reaching its previously projected year-end target of $5,000 has diminished.