Gold prices have grown by almost 17% in the last 12 weeks and have set the stage for a yearlong rally, according to Alain Corbani, a gold fund portfolio manager and former director of RBC Capital Markets.
Corbani says there a trio of highly favourable market conditions mean the gold bulls will go from strength to strength in 2023. He says a change of course by the Federal Reserve policy action, falling U.S. dollar and inflation levels all support a stellar year for the precious metal.
“All these three key data have started an inverted move. They stopped peaking and are heading south,” he said. “We had a rebound in the price of gold because the data coming from the inflation front, the U.S. dollar weakening, and the interest rates going down, all triggered a new interest in the price of gold.”
Gold prices were up 1.5% to £1,563 ($1,933) in trading yesterday (Thursday) thanks to strong safe-haven demand as the U.S. Treasury hit its debt ceiling. Secretary of the Treasury Janet Yellen informed congress that the £25 trillion ($31 trillion) debt limit had been reached, meaning extraordinary measures were now required.
Those measures could include defaulting on some debt payments, a prospect which would send Wall Street into a tailspin and result in the loss of millions of jobs.
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