Citic Securities: gold will hit the highest this year

China’s biggest brokerage Citic Securities forecasts a rise in gold to the highest levels this year. The price of the precious metal might exceed $2,000 per ounce. Currently, central banks have begun to actively purchase gold, which is one of the most reliable bullish signals.

The People’s Bank of China (PBC) bought 32 tons of the yellow metal at the end of the previous year, surprising the gold market. It was the first officially recorded purchase of the central bank in three years.

However, not only China is interested in gold. Cumulatively, central banks purchased around 400 tons of the precious metal in the 3rd quarter of last year. The World Gold Council (WGC) data indicate that it is 300% more than in the same period in 2021.

Ao Chong, one of the analysts at Citic Securities, stressed that these central banks’ actions signal a potential rise in gold bullion prices. The price dynamics are to remain the same. It will be additionally supported by expectations of interest rate hikes by the U.S. Federal Reserve (Fed), continued geopolitical tension, and fears of a recession.