Gold prices dip after record highs: Investors book profits; Citi raises target

Spot gold fell 0.3% on Tuesday to $4,593.81 per ounce, while US gold futures for February delivery slipped 0.6% to $4,587.10. The drop came after gold surged to $4,629.94 per ounce in the previous session which was its highest ever. Analysts said the decline was driven by profit-taking, a common response after sharp price rises. Kyle Rodda, senior market analyst at Capital.com, said, "There ‌are probably a few people out there just booking some short-term profit, but as we saw yesterday, the dip in Asia hours could be bought pretty quickly."

Citi raised its three-month gold price forecast to $5,000 per ounce. The bank cited low interest rates and rising global risks as reasons for its higher target. The rally was also supported by US President Donald Trump’s announcement of a 25% tariff on countries trading with Iran and warnings of potential military action amid escalating protests. The market is closely watching the criminal investigation into Federal Reserve Chair Jerome Powell. Analysts say the probe could influence US monetary policy in the months ahead. Weak US jobs data last week also strengthened expectations that the Federal Reserve may cut interest rates later this year.

Ongoing protests in Iran, Russia’s war in Ukraine, and US interest in Greenland have added to market uncertainty. Investors are concerned about political instability and possible impacts on oil supplies. These factors continue to make gold an attractive option for investors seeking safety amid global risks.