Strategists at OCBC Bank see initial hesitation in bullish gold conviction in Q1 as vaccine developments continue to accelerate but expect the yellow metal to trade above $2,000 from Q2 onwards as markets divert their attention towards excess liquidity in a world that is on its way to being inoculated from the virus.
Key quotes
“Gold ought to benefit from the sustained fiscal and monetary support in major economies next year, especially within the US and EU.”
“While rising risk sentiment may prove to be an early headwind for gold’s allure as a safe-haven asset, the triple combination of a weak dollar, low yields and rising inflation expectations should continue to drive gold higher.”
“We expect gold to continue rising through the year and trade above $2,000/oz from Q2 through Q4 2021.”
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