The Federal Reserve’s signal that interest rates will fall in 2024 has created healthy momentum in the gold market, according to a market strategist. This will enable the shiny metal to reach record levels in the new year.
Gold has a very good chance of reaching the top next year!
cryptokoin.comAs you follow from , following the latest developments, gold prices quickly exceeded 2 thousand dollars. Despite gold’s recent peak, there’s still plenty of room in the market for higher prices, says George Milling-Stanley, chief gold strategist at State Street Global Advisors. The strategist said, “No one knows how high prices can rise once gold finds its own momentum. “We have a very good chance of seeing all-time highs next year.” says.
While Milling-Stanley is bullish on gold, he doesn’t expect to see a breakout anytime soon. He says the Federal Reserve wants to cut interest rates next year. But he notes that when he will pull the trigger is still a question. He adds that the timing issue should keep the precious metal within its current range in the near term.
2024 predictions for gold
Milling-Stanley’s team sees a 50% chance of gold trading between $1,950 and $2,200 next year, according to State Street’s official forecast. At the same time, the firm sees a 30% chance of prices trading between $2,200 and $2,400. State Street says there is only a 20% chance that gold will trade between $1,800 and $1,950. Milling-Stanley notes that the health of the economy will determine how much gold prices will rise. In this context, the experienced strategist makes the following statement:
My feeling is that we will experience below-trend growth and possibly a period of recession. But this will likely still be accompanied by sticky inflation by the Fed’s preferred measure. This will be a good environment for gold. If we experience a major recession, then our bullish scenario will come into play.
Factors that will be supportive for gold
The strategist expects gold’s potential rise to attract new strategic investors. In this regard, Milling-Stanley says that gold’s long-term support indicates a sustainable momentum until 2024. Milling-Stanley notes that the two ongoing conflicts will ensure that gold remains a safe haven. He adds that an uncertain and “ugly” election year will also increase the safe haven appeal of gold. He also states that increasing demand in India and other emerging markets will provide support for physical gold bullion.
Milling-Stanley states that the only wild card for the physical gold market is China, and that weak economic growth and instability in the financial market may alienate many consumers from the market in an environment where prices are rising. Finally, more purchases by central banks will contribute to the new paradigm shift in the market. The strategist explains his views on this issue as follows:
For the past five years, it made sense to take profits when gold was above $2,000. I think that’s going to be part of the reason why we’re going to get below $2,000 at times next year. However, I still think that at some point gold will rise well above the $2,000 level. Central banks have been purchasing between 10% and 20% of annual demand very consistently for 14 years. This has been tremendous support whenever gold has shown signs of weakness. I expect this trend to continue for many years to come.
Its dual structure will attract new investors
Milling-Stanley says that in a world of economic uncertainty and geopolitical turmoil, he expects a significant sell-off in gold to be bought relatively quickly. According to the strategist, the promise of gold for investors has historically always had a binary nature. Based on this, the strategist makes the following comment:
Over time, but not every year, gold can help boost the returns of a properly balanced portfolio. Additionally, gold will always reduce the risk and volatility of a balanced portfolio. I expect this dual promise of returns and some protection to attract new investors in 2024.
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For the rest of the article, 2024 Gold Prediction from the Master Strategist: These Levels Are Not a Dream!