Gold: Limited upside into 2017 - BAML
|Analysts at Bank of America Merrill Lynch note that the gold has faced strong headwinds after the US presidential election, as rising nominal rates have also pulled up real rates, with the latter generally the most important price driver.
Key Quotes
“Given the macroeconomic backdrop in the US, we see limited upside to the yellow metal into 2017 and anticipate prices to trade at $1,200/oz by mid-year. That said, there is scope for a pick-up of inflation, partially because the US is looking to increase fiscal spending while the economy is not in recession. Hence, we maintain our constructive view longer term.”
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