“We nonetheless possible have upside, because the greenback continues to weaken, rates of interest are coming down after which there’s a wholesome dose of geopolitical uncertainty that makes gold a lovely possibility for traders,” mentioned Miskin, who’s co-chief funding strategist on the fund.
Robert Crayfourd, who co-manages the CQS Pure Assets Progress & Revenue fund in addition to the Golden Prospect Treasured Metals fund, mentioned assist would additionally come from ETFs, which may amplify market strikes.
“ETFs had been regular sellers for 18 months, and have now been steadily including for the final three months,” Crayfourd mentioned. “And that’s the place I believe that price minimize has a much bigger influence.”
Massive banks additionally see gold gaining extra floor. Goldman Sachs Group Inc. is forecasting costs to rise to $2,700 an oz. by early subsequent yr, whereas UBS Group AG sees them hitting that mark by mid-year. Citigroup Inc. is much more daring, predicting again in April that bullion may break the $3,000 an oz. barrier by mid-2025.
Nonetheless, some traders see the market taking a breather, with the Fed pivot additionally sparking a short-term desire for riskier belongings, together with small-cap US shares or different equities.
“We lowered a few of the obese for gold forward of Fed’s announcement — we don’t have any additional plans to alter our place,” mentioned Darwei Kung, head of commodities and portfolio supervisor at DWS Group. “We’re nonetheless optimistic for gold within the medium to longer-term,” he mentioned.
Others warned that the Fed’s easing cycle, which usually advantages non-interest paying gold, could also be shorter and fewer dramatic than many anticipate.
“An excessive amount of easing is priced proper now, ranges which resemble recessionary developments which we don’t suppose will play out,” George Efstathopoulos, a portfolio supervisor at Constancy in Singapore, mentioned. “If a few of these cuts finally get priced out, we may see a correction on gold costs.”
However that will nonetheless not be sufficient to tarnish gold’s shine, in response to Grant Samuel Funds Administration funding strategist Stephen Miller.
“There’s been plenty of situations within the final two or three years the place markets have gotten forward of themselves on price cuts — however gold didn’t actually have a setback by way of all of that,” Miller mentioned. “It’s not nearly rates of interest.”
Deeper structural issues in regards to the US deficit forward of the November election and simmering geopolitical conflicts in Ukraine and Center East will proceed to drive traders to purchase extra bullion, in response to Gary Dugan, chief government officer at International CIO Workplace in Singapore.
“Bear in mind when individuals used to say ‘oh, you realize, gold’s above $2,000, I’m not going to purchase anymore’?,” mentioned Dugan. “Now, they only need it.”
(By Sybilla Gross and Yvonne Yue Li)