Gold could hit $3,000 as economic crisis bites

Issac John /Dubai Filed on August 7, 2020 | Last updated on August 7, 2020 at 08.21 am

(Agencies file)

Price corrections can happen along the way, but gold investors should buy on the dip, Holmes said.

Gold extended its surge on Thursday, nearly touching the previous day's record peak at $2,050.27 per ounce, as pundits predicted that the yellow metal would continue its relentless rally to hit $3,000 an ounce on the strength of its safe-haven allure given the deteriorating global outlook. Spot gold was up 0.5 per cent at $2,050.27 per ounce by 0928 GMT, after hitting an all-time high of $2,055.10 on Wednesday while US gold futures rose 0.7 per cent to $2,063.50.

Frank Holmes, CEO of US Global Investors, doubled down on his $4,000 an ounce forecast by the end of this bull cycle call as precious metal analysts agreed that the fiscal and monetary conditions have never been stronger for gold prices.

Price corrections can happen along the way, but gold investors should buy on the dip, Holmes said.

Since bottoming at $1,050 in late 2015, gold is now up by 90 per cent, having rallied about 35 per cent this year. Its price chart shows the metal is establishing a series of higher lows and higher highs; a clear bullish technical signal.

"The upward momentum in gold and silver is still fairly solid at this stage because there's a lack of interest in other asset classes; many factors of the economy are still struggling," Bank of China International analyst Xiao Fu said.


Issac John

Editorial Director of Khaleej Times, is a well-connected Indian journalist and an economic and financial commentator. He has been in the UAE's mainstream journalism for 35 years, including 23 years with Khaleej Times. A post-graduate in English and graduate in economics, he has won over two dozen awards. Acclaimed for his authentic and insightful analysis of global and regional businesses and economic trends, he is respected for his astute understanding of the local business scene.

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