Gold slides below $5,000 as Lunar New Year holiday mutes trade

Core Viewpoint - Gold prices have experienced volatility, slipping below $5,000 an ounce amid thin trading conditions, influenced by recent US inflation data and market sentiment [1][2]. Group 1: Price Movements - Gold fell as much as 1.4% on Tuesday, following a 1% loss in the previous session, with current trading at $4,967.82 an ounce [1][6]. - A speculative buying wave had previously pushed gold to a record high above $5,595 an ounce, but a two-day rout brought it back to near $4,400, from which it has regained roughly half of its losses [2]. Group 2: Market Forecasts - Major banks, including BNP Paribas, Deutsche Bank, and Goldman Sachs, predict that gold prices will resume an upward trend due to persistent factors such as geopolitical tensions and a shift away from currencies and sovereign bonds [3]. - Jefferies analysts have raised their 2026 price forecast for gold to $5,000 an ounce from $4,200, citing inflation and dollar debasement as key supportive macro factors [4]. Group 3: Market Sentiment and Risks - Analysts suggest that if gold remains below $5,000 for an extended period, it could discourage bullish traders due to recent volatility, increasing downside risks [5].