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Amid the gold price reaching an all-time high, experts have suggested increasing investments as the upward trend is expected to continue.
Hwang Byung Jin, a researcher at NH Investment & Securities, stated in a report on the 11th, “As the tight monetary policy led by the U.S. Federal Reserve is nearing its end, the gold price has approached $2200 per ounce. The record-high gold price rally continues.”
Typically, when global monetary policy eases, the gold price goes high, implying that the current uptrend in the gold price is about to intensify.
The value of gold, which had been lackluster since the beginning of the year, began to surge as the U.S. Federal Reserve hinted at the possibility of an early interest rate cut this month.
Researcher Hwang explained, “Expectations for a disinflation cut (interest rate cut due to price stability) appear as a downward stability in real interest rates, highlighting the investment appeal of assets that don’t have interest.”
The investment opinion on gold investment maintained an “increase in weight.”
The gold price forecast for this year was revised upwards from the previous $1900-$2200 to $2000-$2330 per ounce, and the long-term target price was also raised from $2550 per ounce to $2600.
The strong buying sentiment also raised the possibility of short-term adjustments due to expectations of breaking the all-time high gold price.
Researcher Hwang pointed out, “It’s true that there’s a caution against short-term overbuying surrounding the divergence between the real holdings in ETFs and the gold price.”
He judged, “In the dominance of the U.S. dollar, central banks are buying gold to diversify their foreign reserves, overwhelming the decrease in real holdings in ETFs.”
Accordingly, he advised, “If a short-term adjustment in the gold price appears, it can be used as an opportunity to buy at a low price to increase the long-term investment.”
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