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Economists at Citibank expect gold (XAU/USD) to see further sideways trading between the $1700-$1900 range in the rest of the year.

Rising 10-year Treasury yields weighs on the yellow metal

“We expect that XAU/USD could mostly hover between the $1,700-$1,900/oz range for the balance of the year and average $1,800/oz in 2021.”

“We see several peak cycle risks for the bullion market. These include risk of the US Federal Reserve tapering asset purchases by end-2021 and more aggressive short-term interest rate trading pricing for policy rate lift-off in 2022/2023 which may, in turn, be USD supportive.”

“The rise in 10-year Treasury yields this year is also a headwind for a long duration zero-coupon asset like gold.”  

“A risk asset and commodities reflation narrative amid a COVID-19 vaccine trade could also favor inflows into oil, copper and other markets versus gold.”