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Gold (XAU/USD) is down around 15% from its mid-2020 high and strategists at Deutsche Bank do not expect a major rebound. The rate of change in real yields has gone from sharply declining to relatively flat (or even rising) as nominal rates have begun to rise – providing less support for the yellow metal.

Key quotes

“A firmer US dollar and stabilising real yields (after rapid declines in 2020) have removed some tailwinds for gold. This has reduced investor appetite for gold as evidenced by falling retail and speculative investor positions.”

“We have revised down our 12-month price forecast although unexpected events or a sharp one-off increase in inflation expectations could provide some temporary support.”  

“End-March 2022 gold price forecast: $1,850/oz.”