U.S Election, Gold & Economic Recovery Shape (Post-Election)

Ross Norman (Independent Consultant), James Steel (Chief Precious Metals Analyst, HSBC) and Suki Cooper (Executive Director, Precious Metals Research, Standard Chartered) returned for a follow-up webinar after the US election to discuss the outcome, how the gold market has reacted, and a wider conversation on the outlook for the gold industry and the wider economy.

In summary, the mood was positive for gold; whilst the US fiscal stimulus will likely be less than previously thought, looser US monetary policy remains gold supportive. Real rates should stay low or negative; central bank gold buying will continue but perhaps at a slower pace than before, and now we’re getting some initial positive signs that key physical markets such as China and India are starting to get more comfortable with current prices. ETF buying has slowed down, with selling emerging this month, but expectations for loose Fed policy allay some of those liquidation fears. Ultimately, gold’s path will be heavily determined by the direction of US fiscal stimulus and the Covid vaccination outlook.

Finally, we conducted an audience poll during the webinar and the results reveal a bullish bunch - 39% see gold trading at $2000+ at the end of 2021.

 

12 November 2020