Right now, the precious metal is being driving by a multitude of bullish tailwinds including the Fed’s long-awaited “pivot” towards aggressive interest-rate cuts in 2024. In a note to clients, analysts at GSC Commodity Intelligence doubling down on their view that “the Fed will cut interest rates by a total of 100 basis points by the end of this year”.
Then there’s central bank gold buying, which no signs of slowing down anytime soon. According to proprietary data compiled by GSC Commodity Intelligence – 74% of global central banks are planning to significantly increase their Gold purchases in the second half of 2024.
And last but definitely not least – the historically strong correlation between U.S government debt and Gold prices.
Conclusive evidence shows during the period U.S national debt has ballooned from 5 trillion to 35 trillion dollars – Gold prices have risen by 8x since 2000.
But here’s where things really start to get interesting. If history repeats itself, Gold prices could reach $5,000 an ounce when U.S national debt hits the 70 trillion dollar mark.
All of this tells us one thing. Gold prices are only heading in one direction from here.
And that’s higher, a lot higher!
That’s exciting news for the bulls, but painful for anyone sitting on the sidelines, who must now decide how much FOMO they can handle.