CNBC reports that gold prices recovered slightly from a sharp fall earlier this week, but analysts are still pessimistic on the outlook for the precious metal going forward.

On Sunday evening, gold prices dropped to a four month low of $1,677.9 per ounce. The metal was hovering around $1,750 per ounce Thursday morning trade, still off its highs earlier this year of around $1,900.

Analysts pegged the fall to a stronger-than-expected U.S. jobs report as well as a rush to buy the dollar in response.

“The initial sell‑off in the gold price on Monday was likely triggered by the Asian market buying the US dollar and selling gold in response to the strong US payrolls for July from last Friday,” Vivek Dhar, commodities analyst at the Commonwealth Bank of Australia, said.

While gold has since recovered some losses, Dhar said it was “difficult to remain bullish on the precious metal,” given the hawkish outlook for U.S. monetary policy.

The Federal Reserve is expected to dial back monetary easing and slow its stimulus efforts as the economy recovers from the pandemic. The U.S. central bank has held rates near zero, but officials have signaled that hikes could happen soon, especially with inflation running hot. 

“A stronger US dollar combined with a gradual increase in US 10 [year] real yields suggest that gold prices should trend lower,” Dhar wrote.

He predicts that gold prices will fall to $1,700 per ounce by the first quarter of 2022. Meanwhile, Dominic Schnider, chief investment officer at UBS Global Wealth Management, forecast that gold could see drops to $1,600 per ounce or lower.