Gold has rallied toward a new all-time high above $2,070. What is the expectation of gold prices in 6-12 months? Strategists at Standard Chartered expect the yellow metal to surpass the mentioned $2,070 high.
Gold proven to be an effective hedge against geopolitical risk
“Gold is expected to perform strongly in the next 6-to-12 months and the 2020 high of around $2,070/oz could be surpassed.”
“We expect the USD to peak in the coming months, and a weaker USD is a tailwind for gold.”
“We anticipate the economies of China and India, key physical markets for gold, will see reasonable growth as the pandemic recedes and China begins to deploy more growth stimulus.”
“Nominal US interest rates are expected to rise over next 12 months, but real (net-of-inflation) rates are likely to remain low and should not pose a significant headwind for gold.”
“We also see gold’s role as a risk hedge being amplified going forward as recent sanctions on the Russian central bank’s assets and Switzerland’s compliance with individual account sanctions may accelerate a trend to diversify how, and where, wealth is stored.”
“Near-term volatility is possible, but given the overall upward trend, any corrective pullback should be limited by technical support near $1,875.”