Gold prices are on course to match record highs of around £1,426 ($2,000) imminently, which means it is on course to better that as we progress later into the year according to market analyst, Steven Dunn.
The head of exchange traded products at Aberdeen Standard Investments widely expected gold bulls to be in control in the second half of this year but says that momentum has kicked into higher gear earlier than he expected – something which could signal even greater gains for the precious metal as we inch closer to summer.
The analyst says gold is now coming to the fore as both a hedge against rising inflation (something that many market watchers say is already here) and increasing volatility.
He said, “Clearly, there is inflation and if you allow it to run too long, then it becomes a really big problem. Gold has not yet seen its best days in 2021. I have always expected that the second half of the year would be a lot more interesting for gold and maybe we are starting to see that play out a few months early.
“The Federal Reserve is going to remain as cautious as possible, for as long as possible. That will be positive for gold. In the start of the year, investors have been taking on risk, which makes sense with the strong economic growth. But now they are starting to remember the importance of wealth preservation of and they are paying more attention to real assets like real estate and gold. For investors who sold their gold in the first quarter, I think it now makes sense for them to re-establish a strategic position for the second half of the year. Now is the time to protect yourself against what could be a lot of froth in the marketplace… Gold will do well this year.”
Whether you have liquidated your gold holdings earlier in the year, or are now in a position to expand your portfolio one thing is clear – time is of the essence. Buy now to be in the best possible position to benefit as we inch closer to the second half of the year.