This year has been a roller coaster for gold, starting the year at the $1550/oz, dipping to a low of $1450/oz in late March on initial pandemic deleveraging and peaking in August at $2050/oz. Yet, undeniable, the overall trend is still up, 15% from the beginning of the year and strategists at CIBC are forecasting an even stronger performance in 2021 to $2300/oz.

Key quotes

“Governments are under pressure to continue pumping money into the system to fend off further balance sheet pressures. We have yet to see the long-term fallout for the stimulus to date and yet more stimulus is expected. The markets have been buoyed by the recent news of a vaccine, with some market participant expecting a return to more conservative fiscal spending by governments and Central Banks in 2021. This may be premature, as economic risk and uncertainty is far from over, given that globally we are in the midst of second wave, and what will be a 15-18 month global slowdown of the world economy will have longer-term effects.”

“We forecast real rates, the primary driver for gold prices, to remain under pressure for the next several years as governments tackle heavy debt loads and focus on reducing unemployment numbers. The US Fed Reserve will likely reiterate a ‘lower for longer outlook’ particularly in light of the global economic backdrop, which we continue to view as positive for gold.”

“Our gold price forecast now stands at $2,300/$2,200/$2,100/$2,000 per oz for 2021/2022/2023/2024, spot prices of $1875/oz.”

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD retreats further below 1.0900 amid risk aversion

EUR/USD retreats further below 1.0900 amid risk aversion

EUR/USD has accelerated its decline below 1.0900 after having spent the first half of the day fluctuating in a tight range near that level. The risk-averse market environment, as reflected by falling US stocks, helps the US Dollar gather strength and weighs on the pair in the American session. 

EUR/USD News

GBP/USD loses the 1.2400 threshold on US Dollar demand

GBP/USD loses the 1.2400 threshold on US Dollar demand

GBP/USD came under  bearish pressure and declined towards 1.2360 in the second half of the day on Monday. The cautious market mood ahead of this week's high-impact events seems to be supporting the US Dollar and capping the pair's upside. 

GBP/USD News

Gold: Investors defend the $1,900 threshold ahead of critical first-tier events Premium

Gold: Investors defend the $1,900 threshold ahead of critical first-tier events

Spot gold trades uneventfully for a second consecutive day, hovering around $1,923 a troy ounce. The Greenback started the week with a positive tone, although gains were modest ahead of the multiple first-tier events scheduled for later this week.

Gold News

Here’s why Ethereum-killer Cardano whales are shedding their ADA holdings

Here’s why Ethereum-killer Cardano whales are shedding their ADA holdings

Cardano network’s large wallet investors have started selling or redistributing their holdings. ADA price has broken out of the multi-month downtrend and the next bullish target represents a 10% climb. 

Read more

Lucid Group adds 12% on Monday to Friday's 43% gain

Lucid Group adds 12% on Monday to Friday's 43% gain

Lucid Group (LCID) has reversed course in Monday's premarket. Shares of LCID first shed more than 6% early in Monday's premarket, before rising more than 12% later in the session. 

Read more

Forex MAJORS

Cryptocurrencies

Signatures