The 3 primary drivers of the higher gold price

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A snippet from a note via Citi on the primary driver for the higher gold price:

  • The record pace of ETF investor inflows
  • a weakening USD
  • negative real yields 
None of these should be surprising if you've following along, but nevertheless a useful 'in a nutshell' outline from Citi.
Targets from the bank:
  • short-term targets to ~$2,100/oz
  • 6-12m targets breaching $2,300/oz seems plausible
Be wary of these factors:
  • The contraction in global jewelry demand for 2020 persists and still appears worse than the GFC. This may put downside risks on gold.
  • Russia (CBR) has paused fresh purchases as of April. 
  • The PBoC has not increased gold holdings since last September/October, either. 
  • Total net buying of EM CBs should slow dramatically in 2020.
The 3 primary drivers of the higher gold price

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Agree with their 6-12m prediction - not discounting the fact that it could go even higher than that