Gold market continues to see a sluggish demand with the price remaining below $1,800. But according to the London Gold Market Association, there is still a lot of optimism in the market. The latest developments in the gold market and expert analystsdollarserin assessments. Cryptocoin. com we have compiled for you.
“ Gold should be 2% of a well-priced portfolio“
Due to the ongoing COVID-19 pandemic, LBMA held its annual conference digitally this year, and the message on the first day of the conference was that the precious metal continues to play an important role in an investor’s portfolio. According to market analyst Neils Christensen, although last year’s enthusiasm has softened a bit this year, conference attendees still expect prices to rise significantly by next year. According to an online survey, LBMA conference attendees predict gold prices will rise to $1,969 by next year’s conference. The bullish outlook emerges when gold prices struggle below $1,800.
Although LBMA canceled its conference last year, a price survey was still conducted. Last year, the attendees of the LBMA conference predicted that gold prices would be over $2,000 so far. Investors are asking what role gold plays when faced with record stock markets and a potential change in the US monetary policy. Barry Eichengreen, a professor at the University of California, Berkeley, as the keynote speaker of the conference, says he does not see gold as a major hedge against inflation. The professor adds that he sees inflation as temporary, but that the Federal Reserve will lag behind the curve, which will force them to hurry and catch up. Rather than looking at gold as an inflation hedge, Barry Eichengreen sees it as a hedge against uncertainty:
Gold has a low correlation with other asset classes, which means it’s a useful kind of trading tool. Gold should be 2% of a well-stocked portfolio.
John Reade: It will be an interesting quarter
John Reade, chief market strategist and moderator of the precious metals debate at the World Gold Council, acknowledges that gold performs well in times of uncertainty and explains why the precious metal has been struggling lately. John Reade adds that he is not surprised that the interest in gold has remained sluggish as the stock markets move from record highs to record highs:
If you look at the S&P 500 chart over the last few years, investors liked one thing, that ‘something’ is buying the dip. Because it continues to rise. I’m not surprised that gold investment has dropped this year, given that you don’t think you need a variety of stocks, you just need to buy more stocks.
John Reade states that although gold demand has been inconsistent so far this year, market uncertainty is just starting to recover and it won’t take long to change the current sentiment in the gold market. According to the Wall Street Journal, US Treasurer Janet Yellen has once again appealed to Congress, urging US lawmakers to raise the debt ceiling. “It will be an interesting quarter,” comments John Reade, as the US is on the brink of a new financial crisis.