Gold Market Commentary and Outlook

Looking back: A stronger euro and tariff fears edged gold to new highs once again in March. Looking ahead: fiscal and monetary support may be receding, and the timing isn’t great for risk assets given the liberation day turmoil. But gold could benefit further and despite a strong rally, fundamentals remain solid.

Gold hit new highs in February, supported by a weaker US dollar and extending its y-t-d gains to 9%. Rising inflation expectations, lower rates, and continued geoeconomic uncertainty are playing in gold’s favour.  

Gold punched through all-time-highs at the end of January with tariff fears, a weaker dollar and softer bond yields all contributing. Chinese gold market activity stayed true to its typical seasonal January strength and analysis suggests positive follow-through into February.

Gold gave back less than expected due to a strong dollar and profit-taking, as a positive outlook and higher risk constrained outflows.

The start of November saw gold pressured by higher opportunity costs and a Republican clean sweep. Stronger bond yields and US dollar, risk-on in equities, a boost to cryptocurrencies and quelling of geopolitical risk might see a near-term retracement in gold.

Gold posted a 3.6% gain in August driven by lower rates and a weaker US dollar. Mixed data releases have made the direction of global economy less certain and gold options indicate that investors may be hedging against a combination of more aggressive rate cuts and US election uncertainty.

Gold posted a 3.6% gain in August driven by lower rates and a weaker US dollar. Mixed data releases have made the direction of global economy less certain and gold options indicate that investors may be hedging against a combination of more aggressive rate cuts and US election uncertainty.

August has typically been kind to gold, but seasonal winds are up against strong cross currents, that on balance look much more supportive than not.

Gold posted a third consecutive monthly gain in May, rising by 2% m/m to US$2,348/oz. Despite the more moderate gain compared to March and April, gold hit a new all-time high of US$2,427/oz mid-month before pulling back – likely reflecting some profit taking.

In April, we saw strong buying from China and central banks, which resulted in gold reaching intra-month highs before pulling back by month-end. Looking forward, stagflation risks are on the rise as growth looks fragile and inflation remains problematic.