Gold is trading above $1,900 despite the recent rise in US bond yields and the USD. The bank’s economists ANZ analyze the prospects for the yellow metal.
Gold maintains its resistance
While the US Federal Reserve’s “higher rates for longer” narrative gains momentum in response to strong economic data, we see these headwinds having a limited impact on Gold over the coming months.
Central banks’ gold purchases, healthy demand for physical gold and economic growth risks are cushioning the impact of the rate hike. Our view on the dollar’s long-term bearish trend has not changed, and this could be an ongoing tailwind as it shares a negative relationship with Gold.
We believe investors will increase gold exchange-traded funds (ETFs) as the Fed nears the end of its rate-hiking cycle. A revival of investment demand will be crucial for Gold to trade above $2,000 in 2024.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
