Most of us look to the New Year as a time of change but, it could be the case of ‘same old, same old’ for the struggling US economy some experts have warned this week, with whispers that the early part of 2020 could see troubling economic figures and additional rate cuts on the part of the Federal Reserve.
The senior U.S. economist at Capital Economics Michael Pearce says there are already troubling signs in the employment market going in to the end of the year. He says, ““Non-farm payrolls … [will be] flattered by the return of striking GM workers. We wouldn’t take too much comfort from that, however, because recent gains look set to be revised sharply lower in the upcoming annual benchmark revision, while the survey evidence suggests that labour market conditions are deteriorating.”
Han Tan, who is a market analyst for online forex trading broker, FXTM says the recent appetite for risk we have seen in the stock market could also be about to burn out as the long-promised US-China trade deal seems to be dragging on still further, despite repeated assurances from both sides that an agreement had been reached in principle. He says, “The upward momentum for riskier assets is in danger of petering out, with investors perhaps needing clear signs of progress beyond mere snippets of positive spin regarding the potential US-China trade truce.”
TD Security’s commodity strategist Ryan McKay concurs with these viewpoints, further stoking momentum for gold and adding additional reasons to buy now. He says, “There is clearly an asymmetry within the Fed’s reaction function meaning that while they are on pause right now, they are definitely more likely to cut in the future than they are to hike. A hike seems completely off the table and that continues to support gold.”
So, what does all of this mean? In short, buy now. Experts from across the board all seem to agree that the economy is on shaky ground and that could see gold prices spiking in the not too distant future, and almost certainly in the early part of 2020. Buy now to truly benefit.