Bloomberg Intelligence has doubled down on its backing of gold, selecting the precious metal as the asset to beat in 2021. It says that gold is more attractive than US stocks and that the environmental factors which support record high prices remain in play, suggesting there is much more to come for investors.
Mike McGlone, the Bloomberg Intelligence senior market strategist says gold is the one to beat this year. “Gold may gain increasing reference as the performance benchmark to beat. In an investment landscape increasingly dominated by how low — or negative — central banks will set base rates, along with rising debt-to-GDP and QE, we see the foundation solidifying under the price of gold. Resistance at about £1,453 ($2,000) an ounce in 2020 is set to transition to support in 2021. The unlikeliness of reversing the unprecedented global fiscal and monetary stimulus that helped boost gold … about 25% in 2020 — vs. less than 20% for the S&P 500 — should keep the metals atop the leader board. Our bias is that the greater potential for quantitative easing (QE) and debt-to-GDP levels to keep rising should keep metals prices — notably gold … — going up.”
Bloomberg Intelligence also expects nothing but price rises for gold through the course of the year. McGlone, added, “It should be hard for gold to do anything but appreciate, particularly when the metal is in close proximity to its upward-sloping 12-month moving average.”