Gold’s move higher yesterday wasn’t a fluke; with rising inflation expectations proving to be correct and bond yields falling, the precious metal is once again in the driving seat according to a host of analysts who all agree more is to come.
The head of commodity strategy at Canadian investment bank TD Securities, Bart Melek is one of the experts now waiting for prices to go further. He said, “We are setting up for a nice little rally as momentum picks up.” He also expects the Federal Reserve’s accommodative stance on monetary policy to be firmly maintained, even if the US jobs report data due to be revealed later today shows a marked decline in unemployment. Noting that one report won’t change the long term approach, he says the current policy will remain, which is good news for gold. “The Fed will want to run the economy hot and that will change when it changes. Frankly, I don’t think even the Fed knows the timing. For now, print, print, print, spending, spend, spend will be the modus operandi.”
Another gold industry expert, market strategist Colin Cieszynski agrees gold is gaining strength saying “I like what I am seeing in gold. It’s not overbought and it is building up some pretty good momentum.”
Likewise, analyst Robin Bhar sees the bulls gearing up for additional moves higher thanks to spiralling US debt and spiking inflation. He said, “The technical and fundamental improvements we have seen in gold lately are signs of better times ahead. With all the stimulus that is expected to come through, I can see why this narrative of more debt and higher inflation will continue to underpin and even drive gold prices higher.”
Gold is clearly gathering pace and with the general consensus of price gains set to continue, act quickly and buy now to put yourself in the best possible situation ahead of new record highs.