Citi on Monday cut its short-term gold and silver price targets, lowering zero-to-three month gold price forecast to $3,800 per ounce from $4,000 and its silver forecast to $42 per ounce from $55, citing shifts in global market conditions.

The cuts follow trade negotiations led by U.S. President Donald Trump with countries including Malaysia, Thailand, Vietnam, and Cambodia, alongside potential talks with Brazil, India, and Taiwan while China’s President Xi Jinping has signaled openness to discussions, reducing market uncertainty, Citi said.

The bank said that changes in price momentum, the potential resolution of the U.S. government shutdown, and lower inflation expectations could weigh on gold prices in the near term.

Gold prices have surged 51% year-to-date amid geopolitical uncertainty, rate-cut expectations, and central bank buying. They hit a record high of $4,381.21 per ounce on October 20 but have retreated 10% since then. [GOL/]

"The litany of worries that are driving gold higher may eventually need to become the base case to sustain this bull run through 2026," Citi said, adding that the medium-to-long term case to allocate towards gold as a hedge against possible geopolitical and economic concerns remains strong.