Gold Trades Near Record High | Haven buying and China's consumers fuel demand
Bullion has been on a tear, driven by wars in the Middle East and Ukraine, buying by central banks and consumer demand in China. Goldman Sachs Group Inc says the precious metal’s in an “unshakable bull market,” and has raised its year-end forecast to US$2,700. UBS Group AG sees US$2,500 by the year-end.
According to Citigroup, gold will be driven by increased flows from managed money players, who are already showing signs of catching up with demand from physical consumers in China and central banks. The start of a Fed cutting cycle — or a potential recession scenario — into 2025 will provide further impetus for investment demand.
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Inflows into gold-backed exchange traded funds — largely absent in recent years — will “buffer the path to US$3,000,” the analysts wrote. Citi sees increased prospects for a pullback in prices around May or June, but expects “strong buying support” at the US$2,200 an ounce threshold.
