Forex Market News Today
  • Home
  • News
  • LiveHourly
  • Markets
  • Stock
  • Business
  • Economy
  • World
  • Politics
  • Energy
  • exchange
  • companies
No Result
View All Result
Forex Market News Today
Home Economy

Gold to trade near $1,900 in 2021, price risk is to the downside, says Capital E…

3 months ago
in Economy
3 min read
Gold to trade near $1,900 in 2021, price risk is to the downside, says Capital E…
Share on FacebookShare on Twitter


Editor’s Note: Get caught up in minutes with our speedy summary of today’s must-read news stories and expert opinions that moved the precious metals and financial markets. Sign up here!

(Kitco News) Capital Economics has released its outlook for next year, in which it sees gold trading at $1,900 an ounce with a risk of more selling.

Gold is up around 20% on the year, a stellar performance, but most of that price action took place in the spring and summer months. Since September, gold has been consolidating towards the $1,850 an ounce level. At the time of writing, February Comex gold futures were trading at $1,831.70, down 0.65% on the day.

Capital Economics describes its outlook as positive but highlights some key downside risks, including quicker-than-expected economic recovery.

“We expect that the price of gold will trade at around $1,900 per ounce through 2021 as U.S. real yields remain low. That said, we recognize that there are some key downside risks to our forecast. U.S. nominal yields could surge and investors could intensify their selling of safe-haven assets, perhaps because of a faster-than-expected revival in U.S. economic activity,” wrote Capital Economics assistant commodities economist Samuel Burman.

Gold has reached its peak back in August when prices hit a new record high of $2,075 an ounce. In the first half of the year, the precious metal was supported by low nominal and real yields, as well as accelerating safe-haven investment demand. Since then, however, investors began to slowly rotate their money into more risker assets. The move has accelerated in November on all the positive vaccine news.

“Our current gold price forecast is based on our view that U.S. real yields will slip a touch in the year ahead. The adoption of average inflation targeting by the Fed should keep nominal yields grounded, while higher oil prices should lift inflation expectations. Although this could boost the price of gold above $1,900, as it did earlier this year, we think that the main risks to our 2021 gold price forecast lie to the downside,” Burman explained.

There are two main downside risks to Capital Economics’ $1,900 gold forecast. The first is the possibility that the U.S. real yields rise once nominal yields pick up due to a quicker-than-anticipated economic rebound. Capital Economics is currently projecting for the world GDP to grow by 6.8% in 2021.

“The market currently expects U.S. interest rates to remain near zero at least until 2023, but this could be brought forward if inflation persistently overshoots its 2% target and if the unemployment rate falls quickly,” Burman said.

The second downside risk is lower investor demand for gold in the new year. “Investors could intensify their selling of safe-haven assets, such as gold-backed ETFs,” Burman wrote.

As risk-on sentiment rises, investor demand falls. November alone saw the second-largest outflow in gold-backed ETFs on record, according to the World Gold Council…



Go to the news source: Gold to trade near $1,900 in 2021, price risk is to the downside, says Capital E…

Tags: CapitalDownsideEconomygoldOutlookPriceriskTrade
Previous Post

Trump offered $850 million to terrorism victims to save Sudan-Israel deal 

Next Post

Dollar, GBP/USD, AUD/USD, Gold & Bitcoin Technical Trade Levels

Related Posts

Live Business and Stock Market Updates
Economy

Live Business and Stock Market Updates

by Forex News
March 5, 2021
0

Here’s what you need to know:Hiring picked up last month as states lifted restrictions and stepped up vaccination efforts,...

Read more
February job growth surges above expectations as coronavirus recovery picks up s…
Economy

February job growth surges above expectations as coronavirus recovery picks up s…

by Forex News
March 5, 2021
0

Yardeni Research President Ed Yardeni and Evercore ISI Chairman Ed Hyman provide insight into economic growth, today’s markets and...

Read more
Fears rise among bond investors as Buffett warns on outlook
Economy

Fears rise among bond investors as Buffett warns on outlook

by Forex News
March 5, 2021
0

“Bonds are not the place to be these days,” Warren Buffett, the Berkshire Hathaway chief told shareholders in his...

Read more
US job growth likely rose in February in rebound from slump
Economy

US job growth likely rose in February in rebound from slump

by Forex News
March 5, 2021
0

Yardeni Research President Ed Yardeni and Evercore ISI Chairman Ed Hyman provide insight into economic growth, today’s markets and...

Read more
Too much stimulus in the U.S. may bring ‘imported inflation’ to China, economist…
Economy

Too much stimulus in the U.S. may bring ‘imported inflation’ to China, economist…

by Forex News
March 5, 2021
0

BEIJING — As the U.S. pumps trillions of dollars into its economy in the wake of the coronavirus pandemic,...

Read more
China Sets Economic Growth Target of ‘Over 6 Percent’ This Year
Economy

China Sets Economic Growth Target of ‘Over 6 Percent’ This Year

by Forex News
March 5, 2021
0

BEIJING — One year after China was battered by the coronavirus, the government promised on Friday a robust return...

Read more
China announces ‘over 6%’ economic growth target, tech plans
Economy

China announces ‘over 6%’ economic growth target, tech plans

by Forex News
March 5, 2021
0

BEIJING (AP) — China’s No. 2 leader announced a healthy economic growth target Friday and plans to make this...

Read more
Crypto industry to Biden: ‘Criminals we are not’
Economy

Crypto industry to Biden: ‘Criminals we are not’

by Forex News
March 5, 2021
0

Sources tell FOX Business’ Charlie Gasparino that the crypto industry is bracing for increased regulations as digital currency gains...

Read more
Gasoline prices may hit highest levels since 2014 as OPEC+ keeps oil output cuts…
Economy

Gasoline prices may hit highest levels since 2014 as OPEC+ keeps oil output cuts…

by Forex News
March 5, 2021
0

Gasoline prices at the pump may climb past $3 a gallon by Memorial Day, following a decision by the...

Read more
ERCOT overcharged for electricity in Texas by $16 billion during freeze
Economy

ERCOT overcharged for electricity in Texas by $16 billion during freeze

by Forex News
March 4, 2021
0

The Electric Reliability Council of Texas made a $16 billion error in pricing during the week of the winter...

Read more
Next Post
Dollar, GBP/USD, AUD/USD, Gold & Bitcoin Technical Trade Levels

Dollar, GBP/USD, AUD/USD, Gold & Bitcoin Technical Trade Levels

Subscribe
Login
Notify of
guest
guest
0 Comments
Inline Feedbacks
View all comments

Latest Forex News

US dollar slides as vaccine news offsets surge in virus cases

US dollar slides as vaccine news offsets surge in virus cases

2 months ago
The NZDUSD attempts to recover – Analysis

Midday update for the NZDUSD 13-01-2021

2 months ago
2 Capitol Police officers suspended and 10-15 more under investigation for alleg…

2 Capitol Police officers suspended and 10-15 more under investigation for alleg…

2 months ago
Canada working with the US to close travel ‘loophole’

Canada working with the US to close travel ‘loophole’

1 month ago

Today Market News

India’s forex reserves increase by $689 million to $584.55 billion
Live

India’s forex reserves increase by $689 million to $584.55 billion

March 5, 2021
Live Business and Stock Market Updates
Economy

Live Business and Stock Market Updates

March 5, 2021
Father arrested in India for beheading his 17-year-old daughter
World

Father arrested in India for beheading his 17-year-old daughter

March 5, 2021
February US Nonfarm Payrolls w/ Christopher Vecchio, CFA
Live

February US Nonfarm Payrolls w/ Christopher Vecchio, CFA

March 5, 2021
February job growth surges above expectations as coronavirus recovery picks up s…
Economy

February job growth surges above expectations as coronavirus recovery picks up s…

March 5, 2021
Live Foreign Currency Exchange Rates
Politics

US cases rise, deaths fall; California; Maryland; Texas

March 5, 2021
  • Contact Us
  • Terms of Use
  • Privacy Policy
  • DMCA
  • CCPA

© 2020 Siteofforex.com

No Result
View All Result
  • Home
  • News
  • Live
  • Markets
  • Stock
  • Business
  • Economy
  • World
  • Politics
  • Energy
  • exchange
  • companies

© 2020 Siteofforex.com

wpDiscuz