Gold to outperform in coming months – Goldman Sachs

In the latest client note, Goldman Sachs’ analysts offered their outlook on gold prices in the coming months.

Key Quotes:

“Goldman Sachs expect it to outperform in coming months.

The dislocation between the gold prices and US rates is here to say.

Gold’s bullish view driven by:

Higher inflation.

Rising EM wealth which historically has been positive for gold.

Increased risk of an equity correction.

On Fed’s rate hike outlook:

Goldman forecasts four Fed rate hikes this year.

Nevertheless.... data from the previous six tightening cycles shows gold's outperformance of 4 out of these 6.

This is likely a function of investors waiting on the sidelines and then becoming interested in gold once the tightening 'catalyst' has passed."