The development of the gold price in US dollars was positive overall in 2023, with the first quarter laying the foundation for the good performance with the third attempt at the previous highs.
It then consolidated down to the $1,900 technical support level in Q2.
Advertising
Trade oil, gold, all commodities with leverage (up to 30) via CFD (already from 100 €)
Participate in price fluctuations in oil, gold and other commodities with leverage and small spreads! With only 100 euros you can trade through leverage with the effect of 3,000 euros of capital.
Plus500: Please note the Hints5 to this advertisement.
Gold is now trading at $1,950 again. The outlook remains positive and here are the reasons:
Important fundamental framework data for the gold price development calmed down in the 2nd quarter. The main factor here is inflation. In the USA, the rate of price increases fell from eight percent at the end of 2022 to three percent in June 2023. Some market participants now see the fight against inflation as already won. However, this assessment could turn out to be premature, since key inflation drivers such as oil prices, cost increases for raw materials and wages will remain permanently high. The costs that arise from the conversion of the economy to a sustainable economic system also continue to contribute to price increases. The increasing Co2 pricing can illustrate this well. The central banks, above all the FED, are still somewhat cautious with regard to the development of inflation. Therefore, interest rate cuts are currently not on the agenda.
The geopolitical situation remains tense both in Europe with the Ukraine war and in Asia with the Taiwan conflict and continues to pose lasting risks to the global order. This great uncertainty makes the “crisis metal” more attractive.
Another aspect for a permanently increasing demand is continuous purchases by the global central banks. They keep adding to their stocks. The exception to this development was Turkey, which sold around 60 tons of gold in the second quarter, apparently for domestic reasons. This burden should no longer apply in the future, meaning that demand can be expected to continue to rise.
The latest aspect in considering the factors affecting the price of gold is the intention of the Bric countries to introduce a gold-based currency. Details are to be discussed and published in August. Although many issues are currently still open, such as the conditions, liquidity and volatility of a gold-based currency, this could be a factor that could shift the relative valuation of gold to fiat currencies significantly in gold’s favor. However, it should be certain that the subject of gold will increasingly become the focus of attention for many market participants.
The last currently important point is the technical situation of the gold price, which not only points to a renewed test of the previous highs, but also suggests new historic highs. In particular because seasonal factors also speak in favor of an increase in the price of gold in the second half of the year.
In summary, the best of the long-term gold bull run may be yet to come. Investors should therefore continue to rely on the shiny precious metal. A gold quota of up to ten percent is still recommended. This can be represented directly by gold certificates, for example Xetra-Gold (WKN A0S9GB) or as a euro-secured variant, for example DB ETC Xtracker, physical gold (WKN A1EK0G). A gold mining fund (I-share Goldproducers, WKN A1JKQJ) is also an investment opportunity.
You can find this and other asset managers with their opinions and online investment strategies at https://www.v-check.de/?utm_source=finanzennet&utm_medium=ppc&utm_campaign=leuapress&utm_content=textlink
By Uwe Wiesner, asset manager at Hansen & Heinrich Aktiengesellschaft in Berlin
More and more private investors in Germany trust in bank-independent asset managers when investing their money. Free from product and sales interests, they can advise their clients in the best possible way. You can find more information at www.v-bank.com.
The above text reflects the opinion of the respective columnist. finanzen.net GmbH assumes no responsibility for its correctness and excludes any claims for recourse.