‘The Fed can’t print gold:’ Bank of America sees bullion price surge to $3,000 as paper money crumbles
“As economic output contracts sharply, fiscal outlays surge, and central bank balance sheets double, fiat currencies could come under pressure. And investors will aim for gold,” the bank’s analysts said, adding that the US Federal Reserve has provided enough momentum to propel investment demand and prices higher.
They said: “Beyond traditional gold supply and demand fundamentals, financial repression is back on an extraordinary scale. Rates in the US and most G10 economies will likely be at or below zero for a very long period of time as central banks attempt to push inflation back above their targets.”
Gold’s recent run began back at the end of September 2018, when the precious metal was trading at $1,465.70. Since then, it has gained 15 percent to $1,689.60. The yellow metal was trading higher on Wednesday, above $1,700 an ounce.
Economists have also noted some headwinds for the gold market such as a strong US dollar and reduced demand for physical jewelry in Asia.
Source: rt.com
Comments