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Gold prices will rise in H2 on a weaker US dollar and bond yields, according to ABN AMRO.
The Dutch lender increased its end-2017 forecast by US$200 to US$1,300/oz, rising to US$1,400/oz at end-2018, compared with US$1,300/oz previously.
"It is likely that in Q3 the gold price outlook will turn positive," FX and precious metals strategy coordinator Georgette Boele said.
"It will be at the time when we expect US real yields start to edge lower and the US dollar starts to decline versus a number of currencies such as the Japanese yen," she added.
The bank expects the Federal Reserve to raise interest rates three times this year and says the chances of a fourth rise have increased.
Prices will remain broadly stable in the coming months, Boele added.
Gold ended US$11.60 lower at US$1,226.50/oz in London, its lowest close since February 15, with silver hitting a three-week low of US$17.66/oz, down 67 cents.
"Gold has once again been hit by a triple headwind," Saxo Bank's Ole Hansen said.
The metal has been pressured by a stronger dollar and rising bond yields, linked to increased speculation of a March rate hike by the Fed, and by a surge in global stock markets, he added.