Many institutions are still optimistic about the price of gold.

Although the recent performance of gold prices has been weak, many institutions still have a positive outlook on the future of gold and gold stocks. Luo Zhiheng, chief economist of Guangfa Securities, stated that in the long term, favorable factors supporting the price of gold are still in place. The current sharp decline in gold is not a signal of the end of the bull market, but rather a deep correction in the midst of an upward trend. He analyzed the situation from three angles: first, the normalization of global geopolitical risks, with the Trump administration's foreign policy leading to increased conflicts and chain reactions, which will continue to weaken the credibility of the US dollar. Second, non-US central banks still have a strong willingness to buy gold, which is expected to continue pushing up the price of gold. In the new normal of geopolitical risks, increasing gold holdings has become an important choice for non-US central banks to deal with sanction risks and enhance financial security. Emerging market central banks are particularly active, and there is still plenty of room for reserve growth. Third, if global economic risks shift from "inflation" to "stagnation," gold prices are expected to receive support. Rising global energy prices erode consumer purchasing power on one hand, and on the other hand may lead to tightening of monetary policy to suppress demand and control inflation, eventually leading to economic downturn or even recession. In a "stagnant" environment, the strategic value of gold will be further highlighted. "The medium-term trend of gold prices after each Middle East conflict still depends on US dollar credit and liquidity factors," said Citic Securities, pointing out that looking ahead to this round of conflict, the continuation of loose liquidity and weakening US dollar credit trend will continue to push up gold prices.