Gold to trade around $2,100 next year – ANZ

FXStreet Team FXStreet

Gold (XAU/USD) has taken a hit in recent months. After hitting a record high of $2,063/oz in August, the yellow metal has struggled to find another source of lift. However, gold’s outlook remains positive and strategists at ANZ Bank maintain a 12-month target of $2,100/oz.

See:

Gold to move above $2,000 over the next six months – TDS
Gold to end the uptrend on a break of critical $1,800 support – ABN Amro
Gold to rally towards $2300 in 2021 – CIBC

Key quotes

“With the prospects of an imminent coronavirus vaccine, the likelihood of a strong global recovery and a rally in risk assets continues to improve. This could take some shine off gold’s haven appeal. The yellow metal has traditionally been a strong performer during weak economic periods due to its strong defensive characteristics. However, we don’t think this will scuttle gold’s current rise higher.”

“Gold’s main drivers, real interest rates and the US dollar are likely to provide support over the coming year. Using the US Federal Reserve’s forecasts for rates and inflation, real rates should continue to push into negative territory. And a strong global growth pulse should see the USD weaken further.”

“Our gold valuation model suggests gold should trade around $2,100/oz next year, assuming US inflation rises to 1.7%, USD index falls to 90 and yields on 30Y bonds hold steady around 1.6%. That said, we also acknowledge headwinds in the short-term. The continued strength in equity markets is likely to see further investor rotation out of gold-backed ETFs and into equities. We have subsequently cut our 0-3 month target to $1900/oz. However, we maintain our 12-month target of $2,100/oz.”

Author

FXStreet Team

FXStreet

EUR/USD holds losses near 1.1850 as US, China holidays keep trade muted

EUR/USD opens the week on a softer note, trading near 1.1860 during the Asian session on Monday. Activity is likely to remain muted, with United States markets closed for the Presidents’ Day holiday, while Mainland China is also shut for the week-long Lunar New Year break.

GBP/USD flat lines as traders await key UK macro data and FOMC minutes

The GBP/USD pair kicks off a new week on a subdued note and oscillates in a narrow range, just below mid-1.3600s, during the Asian session. Moreover, the mixed fundamental backdrop warrants some caution for aggressive traders as the market focus now shifts to this week's important releases from the UK and the US.

Gold remains below $5,050 despite Fed rate cut bets, uncertain geopolitical tensions

Gold edges lower after registering over 2% gains in the previous session, trading around $5,030 per troy ounce during the Asian hours on Monday. However, the non-interest-bearing Gold could further gain ground following softer January Consumer Price Index figures, which reinforced expectations that the Federal Reserve could cut rates later this year.

Week ahead: Data blitz, Fed Minutes and RBNZ decision in the spotlight

The US jobs report for January, which was delayed slightly, didn’t do the dovish Fed bets any favours, as expectations of a soft print did not materialize, confounding the raft of weak job indicators seen in the prior week.

Global inflation watch: Signs of cooling services inflation

Realized inflation landed close to expectations in January, as negative base effects weighed on the annual rates. Remaining sticky inflation is largely explained by services, while tariff-driven goods inflation remains limited even in the US.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.