After reaching a new all-time high in August, gold began a slow decline.
The prices continue to fall simply because the world stock exchanges are celebrating, with continuous price records.
The world is ready to restart, and consequently the investors’ interest in safe-haven assets is very low.
Added to this is that the funds are even more distracted by the explosion of crypto currencies, and are shifting their investments to these assets, to the detriment of gold.
When will gold go up? Only when inflation explodes.
Inflation expectations are around 2%, but that's where they've been for the past 20 years or more. Hence, we are not seeing any inflationary pressure and that is why gold is unresponsive. Gold responds when inflation gets out of control.
https://cdn.shopify.com/s/files/1/0065/8856/3508/files/saupload_7x32Ay-svHywYUfQnO-cqJSGPr24FJEBzBdEMF4sD7GGEJvKC-fEA2GWv_mH9lLrrNhonjA9U9rxMfG_JTQ4nh2pcLchLkIOB5FFEEdSrc-YU_CR0CKTixCdnBV2MikfWf7whqdj_480x480.png?v=1615369818
So if inflation goes above 3%, and if the market believes that the Fed will have trouble controlling inflation, then we will see a big hike in prices.
In our opinion, inflation will be out of control in the short term, due to all these trillions of dollars and euros of fiscal stimulus.
So we will be buying gold soon.
The prices continue to fall simply because the world stock exchanges are celebrating, with continuous price records.
The world is ready to restart, and consequently the investors’ interest in safe-haven assets is very low.
Added to this is that the funds are even more distracted by the explosion of crypto currencies, and are shifting their investments to these assets, to the detriment of gold.
When will gold go up? Only when inflation explodes.
Inflation expectations are around 2%, but that's where they've been for the past 20 years or more. Hence, we are not seeing any inflationary pressure and that is why gold is unresponsive. Gold responds when inflation gets out of control.
https://cdn.shopify.com/s/files/1/0065/8856/3508/files/saupload_7x32Ay-svHywYUfQnO-cqJSGPr24FJEBzBdEMF4sD7GGEJvKC-fEA2GWv_mH9lLrrNhonjA9U9rxMfG_JTQ4nh2pcLchLkIOB5FFEEdSrc-YU_CR0CKTixCdnBV2MikfWf7whqdj_480x480.png?v=1615369818
So if inflation goes above 3%, and if the market believes that the Fed will have trouble controlling inflation, then we will see a big hike in prices.
In our opinion, inflation will be out of control in the short term, due to all these trillions of dollars and euros of fiscal stimulus.
So we will be buying gold soon.