Gold price forecasts indicate a strong surge as investors seek refuge in the precious metal amid escalating conflicts. With the ongoing war fueling haven flows toward gold, ANZ Bank analysts delve into the outlook for the yellow metal.
In recent weeks, gold has shown significant momentum, teetering on the edge of breaking through the $2,000 mark. A surge of more than 8% was recorded since the outbreak of hostilities between Hamas and Israel. The deepening geopolitical tensions have solidified gold’s appeal as a safe-haven asset in uncertain times.
However, the outlook for the gold price extends even further. ANZ Bank strategists highlight that beyond the conflict, the potential for further gains lies in the Federal Reserve’s rate cycle approaching its end. As the Fed hints at reducing the pace of rate hikes or even maintaining current levels, US yields are expected to retreat. This, in turn, will lower the opportunity cost of holding gold and provide additional support for its price.
Notably, the demand for gold remains robust in the physical market. Central banks, as well as consumers, are actively seeking the yellow metal as a store of value. This strong demand further bolsters the positive outlook for gold.
As investors navigate a turbulent geopolitical landscape, their inclination towards gold as a safe-haven investment persists. ANZ Bank’s analysis forecasts continued haven flows toward gold, driven by the ongoing war. Additionally, the potential easing of the Fed’s rate cycle and the sustained demand from central banks and consumers add further support to the anticipated rise in gold prices.