Gold prices will rally within weeks, with the gold bulls set to leap to £1,582 ($2,000) before the end of the year, according to one widely respected industry expert. George Milling-Stanley, the chief gold strategist at State Street says that a substantial uptick in consumer demand will send prices soaring between September and December. Events such as Diwali will drive bullish momentum – with a further boost possible from Chinese consumers.
“It would be logical to think that momentum can come from a significant rebound in jewellery and consumer demand,” he explained. After all the time I’ve been looking at it, gold still has the capacity to take me by surprise with the speed with which it moves up when momentum finally kicks in.
“If the Chinese economy gets back on track, then we’re going see a significant increase in gold jewellery demand. Where China goes, so go the rest of the emerging markets in Asia and if they can support their economy, then I expect we will see solid physical demand from Asia through the second half of the year.”
In addition to physical demand, the ongoing question of how many more rate hikes the Federal Reserve will impose will also help to keep prices strong, Milling-Stanely says. During his keynote address at the Jackson Hole symposium last week, Federal Reserve Chairman, Jerome Powell insinuated that the threat of recession still exists. This is good news for gold, with safe haven appeal further increasing the attractiveness of the precious metal. “Gold has remained pretty firm partly because there’s no let-up in this anxiety trade,” Milling-Stanley said. “I think the market is well set up for a rally into the end of the year.”
Don’t wait for those prices increases to kick in. Buy now.
