Gold Price Forecast: XAU/USD to suffer substantial losses on rising inflation concerns – TDS
|In recent weeks, capital fled risky assets to seek haven in precious metals. Looking forward, questions remain around whether the 'stag' will fade at a faster pace than the 'flation'. In such scenario, gold price would suffer significant losses, according to economists at TD Securities.
Global central banks could ramp up their gold purchases following sanctions on Russia
“Consumer demand has also been resilient to higher prices, but is now showing signs of weakness as prices surge. Elsewhere, participants could also be expecting global central banks to ramp up their purchases following the West's aggressive sanctions on Russia, but official data have pointed to lackluster flows in recent months.”
“A more persistent inflation shock than growth shock could spark a substantial rise in expectations for future hikes, particularly as the probability of a recession is creeping higher in the midst of this broad-based commodity price shock. In this scenario, gold prices would present a substantial downside risk relative to current prices.”
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.