Gold price firmed on Monday after hitting a record high in the previous session. Bullion restarted their fourth straight week of gains as growing tensions in the Middle East prompted safe-haven demand.
Iran launched a massive barrage of over 300 drones and missiles at Israel over the weekend — in what is believed to be Iran's first direct attack on its regional foe from Iranian soil.
For some on Wall Street, strength in the price of gold is expected to continue until at least the second half of the year. Citi has previously described the asset as a developed market “recession hedge.”
Goldman Sachs hiked its year-end gold price forecast to $2,700 per ounce from $2,300, citing the metal's bull market's indifference to the usual macro factors. But challenges undoubtedly lie ahead.
The military conflict between Iran and Israel will unlikely cause ripple effects as Arab counties were just calling for restraint. Saudi official even accuses Iran of ruining normalization with Israel
Stubborn inflation has not meaningfully hindered the growth of the US economy so far. If China’s economic woes ease in Q2, the need of hedging will be less warranted.
The yellow metal’s momentum remains despite the sharp pullback from above $2,400, unless a break below $2,305 negates its medium-term uptrend.
EBC Online Trading Support Disclaimer: This material is for general information purposes only and is not intended as (and should not be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by EBC Online Trading Support or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.
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