The softening of the global economy will make gold an even stronger force next year according to experts. Metals Focus, a UK-based consultancy, says it expects gold to hit a potential high of $1650 next year, while averaging a strong $1500 overall.
The firm’s director, Philip Newman says sluggish economies are good news for gold. He expects the precious metal to thrive as markets struggle and negative yield bonds grow.
For the risk averse, he also points out that performance will be slow and steady and not subject to big peaks and troughs, noting “We don’t have a forecast for a tremendous rally, but we do have it moving gradually higher. We think that as the economy starts slowing in 2020, that will bring a pause to the record highs we’ve seen in the U.S. equities. Ultimately, we think this will bring renewed inflows into gold.
“The macroeconomic backdrop is deteriorating into 2020.That tells us you’re going to have loose monetary policy by key central banks….We think this will be ultimately supportive of gold.”