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In its latest outlook on both the US dollar and gold, Bart Melek, Global Head of commodity strategy at TD Securities in Toronto, highlighted the following key points:

Gold will start to rebound in the final quarter of 2018.

Prices to seen average $1,290 in Q3 2018, 1300 in Q4.

Prices to average $1,375 an ounce in the last three months of 2019 and could touch $1,400.

As time moves on, there’ll be less and less reasons to get into the U.S. dollar, which will likely reverse some of the flows.

We do ultimately think that as we move into 2019, the U.S. dollar will weaken, which is a very powerful fuel for the gold complex.

Main reasons cited for the bullish outlook:

  • Fed to hike another two or three times next year before ending its tightening cycle.
  • Fully valued equities.
  • Geopolitical risks.
  • The downward trend in mine supply.