Gold Stuck at $4,000 as Risk Premium Lingers

Gold's price remains stuck around $4,000 an ounce despite its nearly 30% drop from January highs. According to Sucden Financial, the precious metal continues to trade above levels implied by real yields and the US dollar.

This suggests that much of the geopolitical and macro risk premium accumulated earlier in the year has not yet been fully removed. The analysts expect gold to remain supported into late September but largely rangebound within a broad $3,950-$4,300/oz range through the third quarter.

The primary headwinds facing gold remain firmly in place, with sticky inflation forcing major central banks to maintain restrictive monetary policy and pushing real yields higher. While the correction has improved valuations, prices still appear expensive when measured against the macro backdrop.