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George Ma
in
Futures
April 23 10:33

Bank of America: gold price will spike next year

In a report called "The Fed can't print gold" Bank of America predicts a fundamentally new level of gold prices.
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On Tuesday, the price of gold fell as investors gained profits from other financial assets of 2020. Chaos continues in the commodity and stock markets
At COMEX market in New York, contracts for gold supply in June fell by US$49.20 or almost 3%, to US$1,662.00 per ounce in morning trading before compensating for some of these losses.
A week ago, gold futures reached its peak of US$1,788 per ounce while central banks around the world were pumping trillions of USD into into financial markets to stimulate economies that had suffered from coronavirus Covid-19 pandemic.
"As economic output contracts sharply, fiscal outlays surge, and central bank balance sheets double, fiat currencies could come under pressure. And investors will aim for gold"
Bank of America raised its 18-month target price for gold by US$1,000-3,000 per ounce in a report called "The Fed can't print gold. Such estimate can be compared to a record peak of just over US$1,900 per ounce achieved in August 2011 after global financial crisis.

"As economic output contracts sharply, fiscal outlays surge, and central bank balance sheets double, fiat currencies could come under pressure. And investors will aim for gold," said analysts, including Michael Widmer and Francisco Blanche.
BoA expects the gold bars will reach a price of US$1,695 per ounce during 2020 and more than 2,000 dollars next year, but warned that if financial markets calm down, and US dollar will strengthens its position, the prognosis may be too optimistic.
Fall in demand for jewelry in India and China may also stop further increases in gold prices, but Bank of America added that "beyond traditional gold supply and demand fundamentals, financial repression is back on an extraordinary scale."