The ANZ Bank economists outlinesvdg changes in US economic expectations and their impact on gold prospects.
Macroeconomic signals are limiting the rise in gold prices
The first change is the “Goldilocks” scenario. The US economy continues to hold up, as shown by strong economic data. Consequently, the market has ruled out the possibility of a hard landing. This decreases safe haven flows for Gold.
The second economic change is the regime of higher interest rates for a longer time. Our basic view is that rates are at their peak, but we do not rule out the possibility of one more rate hike, depending on the data. In any case, real rates are likely to rise in a context of easing inflation. As a non-yielding asset, gold tracks US real interest rates inversely.
In general, we see short-term headwinds for the gold price. However, our medium to long-term view of gold remains positive. We have moved our $2,100 price target to the end of Q1 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.
