Analytics

Gold is experiencing a notable surge in institutional demand, driven by a confluence of factors including falling real rates, a weakened dollar, and heightened geopolitical risks.

This is stated by analysts from Bank of America. In their opinion, now the gold rate does not demonstrate sustainable growth due to the tightening of monetary policy by the Fed.

Finance Feeds believes that precious metal quotes may go into growth over the next year due to two factors: geopolitical instability and monetary policy of leading central banks.

The Swiss bank UBS believes that precious metal quotes will jump to $1,900 per ounce by 2024, and the British consulting company Capital Economics shows a mark of $1,700 per ounce. Why are the numbers so different? Let's deal with the arguments.

This was announced by the Institute of Silver. The cumulative growth indicator will be, according to estimates, 16% compared to 2021. Demand volume will be a record 1.21 billion ounces. At the same time, 329 million ounces of physical silver investment products are expected to be purchased over the year. This is 18% higher than last year.

This is evidenced by the data for the 3rd quarter of 2022, which were published by the World Gold Council. The volume of global demand for gold investment ingots and coins exceeded 350 tons, which is a one and a half year high.

The IMF recently released a forecast for a global recession in 2023. The decline in economic growth is observed, including in the United States. The fact is that the Fed is raising interest rates to reduce inflation, but lending is becoming more expensive.

Around the world, there has been an increase in the popularity of gold investment bars and coins. The Perth Mint in September sold 88.5 thousand ounces of gold, which is 4% higher on a monthly basis and 36% on a 3-month basis, but at the same time lower by 10% on an annualized basis.

Central banks bought less gold in August than in previous months, despite lower prices for precious metal in the summer, according to the World Gold Council.

According to foreign analysts, the behavior of the precious metal over the next few weeks will play a key role in determining where the course will end up at the end of the year. Everything will depend on US employment and inflation data, as gold usually rises in price amid escalating geopolitical instability and market volatility.