Goldman Sachs Increases Gold Price Forecast To Us$ 1450 By Next Year
Analysts of the global investment bank Goldman Sachs significantly increased their forecast for the price of gold citing renewed growth in emerging markets. In a new report, they forecast a price of US$ 1,350 an ounce in three months, US$ 1,375 in six months and US$ 1,450 by next year.
The analysts expect emerging-market growth trending above 6% for 2018, which they assume will increase household wealth and will result in consumers buying more gold.
According to the firm, the emerging-market gold demand started getting stronger in the fourth quarter as global jewelry demand reached a total of 650 tonnes, the fourth-strongest quarterly performance.
This matters a lot for the level of overall gold demand, as jewelry is the single largest component of demand , while investment demand is typically only around 30% and ETFs are a tiny fraction of this, the analysts were cited by Kitco News.
According to the analysts, the gold price has been able to withstand rising bond yields due to this renewed demand for gold from the emerging markets.
Gold Price Predictions For Next 5 Years
When looking at the potential price of gold over the next five years, there are a lot of factors that could propel it higher. Thats one advantage gold ownership offers: it isnt about one factor or another, its about any factor that increases fear or uncertainty on the part of investors. And there are a lot of risks surrounding us at this point that could cause any type of crisis.
But probably the biggest catalyst right now is monetary dilution. When a currency is debased, it makes real assets like gold more valuable, since they cant be created with a few computer key strokes.
And the U.S. now has both monetary stimulus and fiscal stimulus. Monetary stimulus usually goes first to the banking system and ends up inflating asset prices. But fiscal stimulus are funds injected directly into the economy and immediately spent. Its like me giving you $100 and you deposit it in a savings account vs. spending it that day on groceries.
You probably dont need me to say it, but the U.S. doesnt have trillions of extra cash to spend on fiscal stimulus packages. It already cant balance a budget. Some claim theyll collect on the backend; as jobs are created and the economic grows, tax revenue will increase. But the debts and deficits are so high now theyre mathematically unpayable. And history clearly shows they will lead to inflation .
Where will the funds come from for these stimulus programs? They have to be , which will add to the already bloated deficit.
Hsbc Lowers Average Gold Price Forecast For 2013 And Introduces Forecast For 2015
In early January 2013 James Steel, Chief Precious Metals Analyst, revised HSBCs predictions for the price of gold after factoring in a 2012 year-end price of 1,657 U.S. dollars per ounce. HSBC lowered its forecast for the average gold price in 2013 to 1,760 U.S. dollars/oz and expects the market to remain volatile. For 2014 the bank still predicts a price of 1,775;U.S. dollars an ounce. For 2015 it estimates an gold price of 1.675 U.S. dollars an ounce, the long-term forecast is 1,500 U.S. dollars.
According to Steel, gold prices will recover in 2013. Among the reasons given were the adoption of easing of monetary policy by major central banks, the likely recovery of Indian consumption, strong Chinese demand based on Chinas growing GDP and strong demand from central banks, particularly in emerging countries, which would keep accumulating gold as one strategy to diversify their foreign exchange holdings.
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Uncertainty About The Future
Regime uncertainty is a term used to describe the fears investors have about the future and their ability to predict how government actions will impact their investments. And right now in the US, were suffering a great deal of regime uncertainty.
Its difficult to characterize the US as a country driven by the rule of law, as laws and regulations can change quite abruptly depending on which political party is in power. What is perfectly legal when Republicans are in control could suddenly be prosecuted under Democrats, and vice versa.
The prospects of a Joe Biden win in November are unnerving for many investors, not least because it could mean a rollback of Trumps tax cuts and an explosion in government spending, particularly if Democrats also gain control of the Senate. Weve seen with the latest stimulus proposals how Republicans want to spend a mere $1 trillion, while Democrats want to pile another $3 trillion on top of the deficit thats already at nearly $4 trillion.
Those sums far exceed the amount of money the government takes in through taxation, so how will those bills be paid? Will taxation jump through the roof? Will the Fed monetize trillions more in new debt issuance? Will the dollars purchasing power slide into oblivion as all this new money is created?
Gold Prices: Five Reasons Gold Is Set To Explode
Gold prices are retracing from highs today after touching their highest level in more than seven years. The gold price hit a peak of $1,779 yesterday as investors started to diversify their bets. Five key factors are likely to push gold prices higher in the coming days.
Lets dive deeper.
A jeweller, wearing a face mask and latex gloves due to the COVID-19 coronavirus pandemic, showcases … bars of gold at a shop at the Dubai Gold Souk in the Gulf emirate on May 13, 2020, as markets re-open amidst an easing of pandemic restrictions. – Evening dresses made of gold mesh, gilded sunglasses and glittering crowns are sparkling again from the windows of Dubais historic gold souk which was shuttered during the coronavirus lockdown. Though customers are still missing, for business owners, the reopening of one of the worlds biggest gold markets is a vital move towards normality ahead of the autumn tourist season, in a city that prides itself on shop-’til-you-drop experiences.
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Leading Indicator: Gold To Treasuries Directional Inverted Correlation
The next leading indicator appears to be directionally reliable in forecasting the price of gold. It means this correlation helps understand the direction: up vs. down.
The rate of 20 year Treasuries is shown in light grey on below chart while the gold price is reflected in black.
There is a clear correlation between both markets. The 4 divergences are shown in red, and its clear that its really different compared to the divergences on the gold / USD inverted chart shown above.
These divergences tended to last 6 to 9 months, much shorter than the gold / USD leading indicator. The divergences took place during strong risk off periods.
Chart update: 11.08.20
Commerzbank Predicts Rising Gold Price For 2013
Commodity analysts of Commerzbank predict a further increase of the price of gold in 2013. They forecast an average gold price in 2013 of US$ 1,950 per ounce.
The analysts consider it as likely that the price of gold will at least temporarily exceed US$ 2,000 in the coming year. This could happen as soon as in the first quarter of 2013 if the US would not find a sustainable solution for the budget dispute and an increase of the debt limit would take long.
The most important price driver is expected to be central banks extremely loose monetary policy which would undermine the value of the currencies. Additionally, the debt crisis in the euro zone and the geopolitical risks in the Middle East are considered to be important drivers for a sustained demand for gold as a safe haven.
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Will October See A Rise In Gold Prices In India What Is The Expectation
Today, on the first trading day of October all investors are paying attention to the upcoming gold rates in the month. Today Indian gold rates hiked by Rs. 980/ 10 grams than yesterday. Gold prices in India only experienced a moderate hike since August, but mostly dropped. In July the monthly gold price change was at a positive 2.58%, while in August the same slipped by 2.11%, and again in September, it dropped by 4.08%. In September, the Indian gold rates dropped highest since March 2021 – when the prices were at the lowest levels in this year’s range. Hence, if the same bearish trend of September gold rates is passed on to October, the gold traders will certainly sound worried. But the situation changed from yesterday evening.
Key Gold Levels To Watch
The major price levels for investors to keep in mind for their gold analysis 2021 are as follows:
As a reminder, resistance levels refers to the price at which an asset starts to face new selling pressure. By contrast, support levels are prices at which investors find an asset to be attractive and new buyers could enter the market.
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Inflation A Process Not An Eventbut History Shows Runaway Inflation Can Come Suddenly And Without Warning
Image courtesy of Visual Capitalist Click to enlarge
We sometimes forget that inflation is a process rather than an event. One of the better-known examples of that axiom is the nearly two centuries-long debasement of Romes silver denarius. The Roman citizen who had the wisdom to hedge that process by going to gold at nearly any point along the way ended up preserving some portion, if not all, of his or her wealth. Those who did not suffered its debilitating effects. In the inflationary process, the line between cause and effect is not always a straight one, and its timing difficult to discern. History teaches us, though, that when runaway inflation does arrive, it comes suddenly, without notice, and with a vengeance. That is why it pays to view gold as a permanent and constantly maintained aspect of the investment portfolio. A change of fortune, Ben Franklin tells us, hurts a wise Man no more than a change of the Moon._________________________________________________________________
Looking to prepare your portfolio for whatever uncertainty lies aheadDISCOVER THE USAGOLD DIFFERENCE
Repost from 9-16-2021
Gold stays in tight range ahead of FedMyrmikan Capital thinks new liquidity crisis could evoke policy response, power gold
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Will Gold Price Go Up In 2021 After A Historic Year
Gold investors experienced a turbulent 2020 with the price of the commodity crashing hard and fast during the peak of the Covid-19 selloff. Gold not only rebounded sharply but it also hit a new all-time high and anyone holding gold in January exited 2020 with their precious metal worth more.
So will gold price rise once again in 2021? Lets take a quick recap of golds performance in 2020 and perform a brief gold technical analysis to see whats around the corner.
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Reason Why Gold Will Continue To Rise On Value
For years now, the price of gold has been in a relatively steady climb. Going from $280 per ounce in January of 2002, to a $925 high it reached in January 2008. Thats a 330% climb in just 6 years! That is simply incredible.
Gold is the only worldwide accepted measurer of value. In rough times, fiat money could suffer drastic volatility if there is an issue in the underlying value of the currency, which is basically the country it originates from’s integrity. Here are 5 reason why Gold prices will continue to climb for the foreseeable future:
-1- China and India are growing at rates we have not seen in decades. These two economies value gold more then anything else. From jewelry to a store of wealth, Gold plays a major role in the economies and lives of people in Southeast Asia. Remember that India and China combined have populations almost equal to all the people in the rest of the world.
-2- The US dollar will continue to devalue. With the federal reserve concered about the economy, and trying to prevent a recession, which by the way is a natural occurrence in any economic cycle, the dollar has very little room to gain strength. They continue lowering interest rates meaning foreigners will not want to hold US currency.
-3- Many governments are now trading in those once strong US dollars they had in their reserves for the now more reliable gold bullion. Remember, money grows on Trees, quite literally , while gold is a limited resource.
Gold Price Prediction 2021
Analysts have a mixed forecast for gold in 2021, unlike 2020 when most brokerages were bullish on gold. In 2020, Citi forecasted that gold would reach $2,500 per ounce. However, in April 2021, Citi said that now it expects gold to trade between $1,700 and $1,900 per ounce. It cited a supply surplus, rising interest rates, and investors allocating money to other commodities like copper and oil, to support its bearish narrative.
A report published in February 2021 by the London Bullion Market Association showed that analysts expect gold prices to average $1,973.8 per ounce in 2021, which is 11.5 percent higher than what it averaged in 2020.
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Gold ‘the Ultimate Bubble’ Has Burst
Kimberly Amadeo is an expert on U.S. and world economies and investing, with over 20 years of experience in economic analysis and business strategy. She is the President of the economic website World Money Watch. As a writer for The Balance, Kimberly provides insight on the state of the present-day economy, as well as past events that have had a lasting impact.
Eric is a duly licensed Independent Insurance Broker licensed in Life, Health, Property, and Casualty insurance.;He has worked more than 13 years in both public and private accounting jobs and more than four years licensed as an insurance producer.;His background in tax accounting has served as a solid base supporting his current book of business.
In 2010,;commodities;trader George Soros famously said, “Gold is the ultimate bubble.” He was referring to the;asset bubble;that occurs when speculators bid up prices of an investment beyond its intrinsic value.
Unlike;real estate, oil, or shares of corporations, gold has very little fundamental value upon which to base a realistic price. Soros seemed like a fool when he called gold a bubble at the Davos World Economic Forum. For another year, the;price of gold;soared, reaching a record of $1,895 on September 5, 2011.
Soros’s words have a new relevance: On August 7, 2020, gold hit a new record of $2,061.50 in response to fears of economic uncertainty caused by the COVID-19 pandemic.
Gold Prices Decline But Tally A Rise For The Month
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Gold futures finished lower on Friday, capping a strong week and month for bullion that recently saw prices touch their highest levels in six weeks.
Inflation is accelerating while Treasury yields trend lower, resulting in record low negative yields, which are bullish for gold, Michael Armbruster, managing partner at Altavest, told MarketWatch. It also helps gold that the dollar has rolled over yet again.
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Most Influential Political Events In 2021 For Xau/usd
Despite the liquidity flooding the financial markets, inflation outlook in major economies remains subdued and major central banks voiced their commitment to keeping their policies extremely loose until they see a convincing increase in price pressures. This suggests that investors will not give up on gold in the near future.
On the other hand, a return to normality with mass COVID-19 vaccinations could make risk-sensitive assets more attractive, especially in the second half of 2021, and dampen the demand for the yellow metal.
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We continuously, throughout the year, publish updates on our annual forecasts. Any revision in our forecast are published in the public domain and appear in our free newsletter. Therefore, the only way to track the pulse of markets and stay tuned with our forecasts is to
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Why This Gold Price Prediction
We are here to catch those major moves in gold, and our gold forecast should guide us with this.
We are on the lookout of markets that become a multi bagger in 6 to 9 months time. It is our official mission, formalized at the start of 2020. We call it our Mission 2026, and we even have a target for this: we want to turn $10k into $1M the latest in 2026 by having the best forecasts and associated trades.
Thats the reason why we spend so much time researching and writing our annual forecasts, first and foremost our annual gold price prediction.
This gold prediction suggests that a new bull market in gold and silver has started with the June 2019 breakout in gold as explained in;Gold Enters New Bull Market Right Before Its 8th Bear Market Anniversary this bull market is here to stay for several years.
All this implies that buy the dip is the best strategy going forward, both for playing the gold as well as the silver market. There will be one or two rallies per year going forward. Those are the ones we want to catch. We recommend readers to to follow our work and try to catch those gold rallies in 2020 and beyond 2021.