The London Bullion Market Association (LBMA) asked 23 Gold analysts from around the world for their predictions on the average, high and low price range for the year ahead for Gold. Analysts who contributed to the Survey were invited to identify the top five drivers likely to influence the gold price in 2017. The top two drivers were the US dollar and US real interest rates, followed by demand in China and India, globaal political events and President Trump’s fiscal and International policies. Gold Stock News presents what the Analysts forecast for Gold in 2017.
Standard Chartered, New York
Gold: Range: $1,090 – $1,325
Fatter tail risks, a shifting political environment and government gold import limitations create a tangled outlook for gold prices. We expect the first and last quarters of the year to exhibit the greatest weakness. Three dominant themes suggest downside risk for prices and we advocate selling the rallies: (1) The Indian government has attempted to wean the country off gold and India’s demand has been hampered by a raft of government policies clamping down on the parallel economy. In turn, gold has and will likely continue to suffer collateral damage. (2) China’s buying has been hindered by limitations around gold import quotas, and appetite has been waning. (3) Markets are pricing in three Fed rate hikes for 2017. This will likely be the crippling factor for gold, as real yields start to rise, particularly if inflation remains modest. However, the scope for tail risks is high given the European election calendar and anti-EU sentiment, uncertainty surrounding the US Trump administration, as well as heightened geopolitical tensions.