We live in interesting times.
Gold is shining ‘bright like a diamond’ and could hit $3,000 says Citi (cnbc.com)
“We project $3,000/oz gold over the next 6-18m,” said Citi’s analysts led by Aakash Doshi, Citi’s North America head of commodities research. The financial gold “price floor” has also moved higher from around $1,000 to $2,000 per ounce, Citi said.
On Friday, Goldman Sachs referred to the gold market as an “unshakeable bull market” and revised upward its price target for the yellow metal from $2,300 per ounce to $2,700 by the end of the year.
BRICS: China Drives Gold Price Up By Buying Supply (watcher.guru)
BRICS founder China is currently driving up the price of Gold by swooping in to buy more supply of the precious metal. As the US dollar plummets, alternatives are growing more important within the global reserve. Thus, gold has experienced significant price growth recently, rising to record highs of 2,342.43. According to economists, the People’s Bank of China is leading the way, actively investing in the asset.
Why is Gold Ignoring Higher Rates and a Stronger Dollar? (msn.com)
Since Russia and China shook hands on a “no-limits” alliance in early 2022, many international transactions have circumvented the dollar. Saudi Arabia and other oil-producing countries have sold oil to China and India for non-dollar currencies.
Gold’s ascent with a strong dollar and high interest rates is a sign of the shift in global leadership in trade. Moreover, rising gold prices could be telling us that inflation is eroding all fiat currencies, including the U.S. dollar. The dollar index is a mirage as it only measures the U.S. currency against the euro, pound, yen, Canadian dollar, Swedish krona, and Swiss franc. Gold is telling us that all these currencies are losing value as inflation and a significant global financial shift are changing the worldwide economic landscape.
The trend is always your best friend in markets, and gold’s bullish trend is now twenty-five years old. High interest rates and a strong dollar have not stopped gold’s rally, which is a significant sign that the strength of the precious metal’s bullish price action will continue. Even the most aggressive bull markets rarely move in straight lines. With gold over the $2,400 level and the critical psychological support at around $2,000, a pullback to that support would not threaten gold’s long-term bullish trend. Moreover, the dramatic shifts could support a continuation of higher highs in 2024.
Central bank buying a driver of golds surge (bankingday.com)
The majority of purchases were made by central banks in emerging economies. The People’s Bank of China was the biggest buyer, with an increase of 225 tonnes in its reserves last year.
Other big buyers were central banks in Poland, Singapore, Libya, the Czech Republic, India, Iraq, Qatar and the Philippines.
The council has reported previously that the growth in central bank gold buying reflects a “rebalancing to a more preferred strategic level of gold holdings” amid concerns about increasing financial market risks and the persistence of high inflation.
A small number of the central banks it surveyed said they were pursuing “de-dollarisation” policies. The US dollar accounted for 51 per cent of central banks reserves at the end of 2022.
Central banks in emerging markets tend to be more pessimistic about the US dollar’s future as a reserve currency and more optimistic about gold.
When asked about gold’s future share of global reserves, 62 per cent of advanced economy respondents said it will remain unchanged over the next five years, while 68 per cent of central banks in emerging markets said gold’s share of global reserves will rise.
