Listen to the latest market mood for gold.
Gold prices have hit a month high on the growing fears of increasing COVID-19 cases. The concern is that an increase in US COVID-19 cases will undermine a fast economic recovery.
Furthermore, many investors are increasingly being drawn to gold’s hedging appeal. Weak currencies, the risk of deflation and inflation, low-interest rates, and the rise in the use of QE by central banks around the world all make gold attractive.
Therefore, expect gold buyers at the market and on pullbacks in the medium term.
We expect this outlook to play out over the next 3 months.
Main Trade Risks
- One risk is if there is a swift economic recovery.
- Another risk is if there is a vaccine found for COVID-19 that removes the need for gold as a hedging commodity.