Gold drivers in 2019
In our 2019 Outlook, we cited “monetary policy and the direction of the US dollar” as a key trend to watch this year. With this, we believe that the 20 March FOMC meeting, which will include the Fed’s projections report, will provide more clarity about their monetary policy expectations which, in turn, will offer further guidance about gold’s performance this year. As it stands, current bond prices reflected by the market, which tend to accurately include interim cues from the Fed, are signaling that the Fed will most likely be on hold during 2019 – and has a chance of a cut (15%) for the first time in several years (Chart 1).