Forex forecast for Gold. Possible growth
The price of Gold recovered to the level of $1730 per troy ounce. This is largely due to the dollar index's retreat from last week's five-month high on Wednesday, following the announcement by US President Joe Biden, who announced his second multi-billion Dollar legislative proposal in two months to rebuild infrastructure.
According to analysts of the American bank Wells Fargo, the price of Gold may rise this year to $2200 per ounce. The supply of the precious metal on the market has moved from a surplus to a deficit. In the past, this state of affairs led to the beginning of the price rally of the asset. It is worth recalling that since 2011, the gold market has been experiencing an oversupply, since over the previous 10 years, the price of Gold has increased from $250 to $1900 per ounce. But over the past three years, the situation has changed markedly. The supply of Gold on the market has passed into the stage of shortage. In past years, the shortage of precious metals has always led to a significant increase in its value. According to analysts, Gold may now be at the beginning of a new cycle in the commodity market. The price of the asset has increased by more than 40% since 2018. The bank believes that investors can count on the continuation of the upward trend, which will bring them even greater returns.
Not only will a reduction in the supply of Gold in the market support the value of the precious metal in the future, but also other factors that have a positive impact on pricing at the moment. First of all, these are low interest rates, the printing of unsecured money by central banks and the weakening of the US Dollar (USD). These trends will remain in force for quite a long time. Wells Fargo estimates that the price of one ounce of Gold should rise to $2100 - $2200 this year.
In the forecast, I expect a further recovery in the price of Gold to the level 1750 USD per ounce.