London-based brokerage ActivTrades forecasts that the price of gold, which stayed flat on March 15, will remain stable for the foreseeable period as it is the result of a current tug-of-war between two factors that are almost equally powerful – a U.S. inflation control policy and geopolitical risks stirred by the ongoing war in Ukraine.
U.S. Treasury yields have been surging as a Federal Reserve inflation control measure, thereby bolstering the dollar versus other major currencies and weighing down on gold,.
On the other hand, the war in Ukraine and consequent geopolitical uncertainties have been driving up demand for safe-haven assets, thereby giving a boost to gold, ActivTrades senior analyst Ricardo Evangelista argues.
Gold is likely to remain rangebound between these two factors at least in the short term, Evangelista forecasts.
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