Gold Price Forecast: XAU/USD still considered as a safe-haven and store of value – Commerzbank
Gold is stable following biggest weekly loss in nine months. In the view of economists at Commerzbank, the yellow metal is still regarded as a safe-haven and store of value.
Fed rate hike expectations weighed on gold
“At -3.4%, XAU/USD chalked up its biggest weekly loss since last June. We attribute this to the US Federal Reserve rate hike and the market expectations regarding further rate increases during the course of the year. The higher bond yields and higher real interest rates are also likely to have contributed to last week’s fall. By contrast, the US dollar has depreciated somewhat – so it presumably generated no headwind.”
“ETF investors continued their robust gold buying: the gold ETFs tracked by Bloomberg registered inflows of 30 tons last week. According to the CFTC’s statistics, speculative financial investors remain at an above-average level as compared with the past 1½ years, however. In other words, it is not only ETF investors but also speculative financial investors who appear to be still counting heavily on gold as a safe-haven and store of value.”
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FXStreet Insights Team
FXStreet
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