There is more reason to be bullish on gold right now as early indications seem to suggest that below zero interest rates could be on the horizon.
Overnight interest rates have been pushed close to zero, which economists say could result in the federal funds rate dipping into the red (the federal funds rate is the rate banks charge each other for overnight loads). If the funds rate does drop below zero, the implication is that the market is prepared for the Federal Reserve to confirm below zero interest rates. With analysts from across the financial spectrum highlighting the real low interest rates as supportive of record gold prices, this is potentially promising news for the precious metal – and suggests that now would be an opportune moment to buy.
What happens next will be telling; if the rate continues to hover near zero, it’s likely that the Fed will need to step in to take measures to rectify – something that could again be good for gold prices moving forwards.
With any degree of uncertainty, gold reaffirms its position as a safe haven. Buy now to benefit.