2023 Forecast For Gold Prices From 2 Famous Forecasters! – Cryptokoin.com

The aggressive tightening cycles of central banks that marked this year have been limiting for gold prices. With the policy easing after that, Bloomberg Intelligence predicts gold will be the best performing commodity in 2023. Also, increasing uncertainty to 2023 will make the precious metal an attractive safe-haven asset and store of value, according to a market analyst.

“Gold prices will perform well in 2023.additional”

Mike McGlone, senior macro strategist at Bloomberg Intelligence, comments on the latest developments:

Our baseline scenario is towards a global deflationary reset that would shift central bank tightening to easing. This will be the development that forms the basis of gold. If the world goes into a recession, it’s possible that gold will be the best performing commodity in 2023.

The Federal Reserve continues to raise rates in the most aggressive tightening cycle in nearly 40 years. In this environment, gold prices formed a good footing between $1,600 and $1,700. But McGlone says that will soon be over. It also states that it will lead to a softer US dollar in the future.

“This is a positive sign for yellow metal”

Mike McGlone also notes that there is a growing disparity between gold priced in US dollars and gold priced in euros and yen. For the analyst’s accurate predictions cryptocoin.comCheck out this article. He also states that this will likely be taken as a positive sign for the precious metal. In this context, the analyst makes the following statement:

The disparity between gold priced in dollars and euros is approaching levels that formed a permanent basis for prices in 1999. It’s down about 5% in 2022, compared with increases of 5% and 15% for the metal priced in dollar gold, euro and yen through November 28, respectively. The Fed is tightening aggressively to rein in inflation and rising asset prices, as the rest of the world tries to catch up with the echo trends of nearly two decades ago. This also supports the dollar. Now the supports are getting stronger for the gold price to continue the rally that started on this basis.

Gold prices

“Economic growth will not be beneficial for gold prices”

The biggest risk for gold will be a surprise rebound in economic growth, potentially triggered by China. McGlone notes that this would be beneficial for industrial metals, but not for gold prices. However, the outlook is not very favorable for industrial metals in 2023. Based on this, the analyst shares the following comment:

With the stock market falling in 2022, copper and industrial metals reflect the risks of declining global economic growth in 2023. Due to the Russian invasion of Ukraine in 2022, inflation increased due to the impact of commodities. This accelerated the tightening trajectory of the central bank. However, it is possible that this will result in a more permanent global recession.

Gold prices

“It is not surprising that investors are moving away from precious metal”

Joy Yang, Global Head of Index Product Management at MarketVector Indices, says there is a lot of ebb and flow in the market as rising inflation forces the Fed to raise interest rates at the fastest pace in 50 years. At the same time, slowing growth in China and Europe has increased the threat that the global economy will plunge into a major recession.

In this environment, Yang notes that it is not surprising that investors have turned away from the precious metal this year. He adds that he does not see this as investor indifference, but as hesitation. In this context, Yang makes the following statement:

A lot is going on in the global financial markets. That’s why investors want to be careful. Because getting something wrong in these circumstances would probably be pretty painful.

Central bank purchases are an important supporting factor for gold prices.”

However, Joy Yang adds that investors are starting to recognize the value of gold as a safe asset. Another important factor that sheds new light on gold is Central Bank demand. In the third quarter, Central Banks bought about 400 tons of gold. Last week, the World Gold Council (WGC) reported that Central Banks bought 31 tons of gold in October. WGC noted that the Global Official Gold Reserve totaled 36,782 tonnes, the highest since November 1974. Yang comments on this:

If you look at all the noise, investors can see that there are plenty of benefits under gold and it will attract investor demand. Its continued role as the global reserve currency will continue to support demand.

“The collapse in the crypto market also supported gold prices”

Joy Yang says another factor that should improve investment demand for gold is the ongoing collapse of cryptocurrencies. In the last few years, some investors have seen cryptocurrencies as a better store of value. Thus, the unprecedented demand for cryptocurrencies like Bitcoin had a significant impact on gold. However, gold has outperformed Bitcoin significantly recently. Thus, it is down 63% so far from the start of the year as the bulls try to hold support around $17,000. Meanwhile, gold prices fell less than 3% over the same period.

As can be seen, gold outperformed digital currencies. Despite this, Yang says the market has learned a valuable lesson from the growing digital market. Accordingly, he notes that if gold is to attract new investors, it needs to develop a larger digital footprint. He expresses his views on this matter as follows:

I don’t think the future of gold is purely digital. As a physical entity, it’s too important to be fully digital. But digital gold will provide investors with ease of access, just as ETFs provide ease of access.

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