یکشنبه, ۵ بهمن , ۱۳۹۹ 11 جماد ثاني 1442 Sunday, 24 January , 2021 ساعت ×

Analysis of recent global gold price declines

شناسه : 35645 ۱۶ آذر ۱۳۹۹ - ۱۴:۴۶

The world price of gold has been declining for the past 20 days, right after the announcement of the official results of the US elections, and this trend is likely to continue. With the seriousness of the news of the discovery of the corona vaccine and the attempt to reach the stage of mass production, […]

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The world price of gold has been declining for the past 20 days, right after the announcement of the official results of the US elections, and this trend is likely to continue. With the seriousness of the news of the discovery of the corona vaccine and the attempt to reach the stage of mass production, the global fortune to buy gold has reached a minimum, and this issue has greatly affected the global ounce market. In this note, we will point out the latest reasons for the fall in global gold price. Please be with Artan Press.

 

*** Stability in global markets

As we discussed recently, the balanced outcome of the US election (Democratic President and the balance of the House and Senate) will push global markets towards greater stability and predictability. In the current situation, the market is moving in a direction that increases the risk of high-risk assets and lowers gold, because the behavior of the US government in the future is more predictable than before, and on the other hand, Biden’s policies are likely to weaken the dollar in the market. Will be different global.

The global market has been tense for the past two months due to the radical behavior of the US President and has been practically going up with high excitement. To the extent that the global ounce price is above two million, it can be seen in the price perspectives of analysts.

This created a great opportunity for speculators to make a profit, and in fact, with the strengthening of the dollar against the euro, we saw a further increase in the price of gold in world markets. While gold has had a significant support level at around US $ 1,850 an ounce over the past four months, it broke that level yesterday and continued to fall today as expectations of market risks eased to near $ 1,800 an ounce.

 

*** Reasons for the recent decline in gold prices

There are several reasons for the recent drop in gold prices. First, there are currently three successful approved vaccines, with AstraZeneca being the last company to report good results. US President-elect Biden has announced his cabinet and announced Janet Yellen as his new Treasury Secretary. As head of the US Federal Reserve, his consistent policies in high-risk markets have been positive over much of the past decade, and his election has given analysts more optimistic about trading market conditions.

This hope is actually accompanied by a reduction in tensions in global trade and international trade, and this alone can lower the price of global gold. Finally, the Bureau of Public Services declared Biden the winner of the presidential election, and surprisingly, President Trump agreed to transfer his team to the new administration.

 

*** Global Gold Price Analysis

While the above news is negative for gold in the short term, some potentially positive catalysts have emerged. While Janet Yellen’s announcement is positive for stocks, ironically it should be positive for gold as well, as it increases the likelihood of a rate cut over the long term. We continue to highlight lower rates as a short-term signal for gold price analysis because it increases the opportunity cost for gold traders.

The seasonal improvement in gold demand in India and China is also positive for gold. Jewelry sales in China rose in October as the country’s economy continued to grow, and recent data suggest positive consumer activity in India, which is likely to slow down as global ounce demand rises as Indian demand increases and price growth scenarios in the range Short-term strengths.

In this regard, we have to wait for the movements of the Indian and Chinese markets. If these two countries follow the path of other countries and supply exceeds demand, we will see a sharp drop in prices in the global ounce. But these two countries can follow the path of decline. Stop alone having to wait and see the result.

 

*** Yield ounce of global gold

Despite these declines, the global ounce of gold has returned about 17 percent higher than other global markets this year, and the corona issue has actually fueled that. Gold yields are likely to be challenged by reducing political and corona risks, and we will see the growth of parallel markets by the end of 2020.

However, it may take some time for the vaccines to be approved and even longer than before, and a significant portion of the population will be vaccinated. Concerns about whether enough people will provide and support the vaccine for safety are also unclear.

Any scenario of failure of Corona vaccines will have a strong impact on the growth of world gold prices, because in the current situation, the price of gold has preceded many of these news and have been finalized, assuming that the price situation is positive. In the current situation, its economic impact for the coming years is understandable. And additional financial and monetary assistance will probably be needed to “improve” the economy, and add additional credit and support for gold demand.

 

*** ۲۸% growth in global gold prices

Gold prices have risen 28 percent since the beginning of 2020, due to the corona virus epidemic, but it is difficult to predict how much it will rise in the coming months and beyond. Gold was priced at $ 85.85 an ounce as of September 18, and jumped from $ 1,520.55 per ounce at the beginning of 2020. Most analysts expect the epidemic and its economic consequences to further increase the precious metal, which has had a profound effect on the global price of gold.

The price is expected to return significantly to its true value Analysts are considering the socio-economic conditions of the coming years without the corona, and this optimistic outlook for the future could lower the global price of gold by up to 40 percent. However, macroeconomic conditions appear to be largely off demand. Short-term support, but supply expands faster than in previous years.

 

*** World Bank assassination of Shahid Fakhrizadeh expectations of global gold prices

The US Federal Reserve and the World Bank assassination of Shahid Fakhrizadeh set their expectations for gold to reach $ 3,000 / ounce in 2022 in August. Analysts from the two economic institutions have announced negative real interest rates and inflationary pressures, as well as the weakening of the US dollar due to the Corona virus epidemic, and predict that we are at the end of the risk line in the current situation and will most likely see a further decline in gold prices. We are global.

Other economic analysts have been more cautious about the global gold pricing outlook. Researchers at the Fitch Institute recently estimated that gold would average $ 1,850 an ounce in 2020 and 2021, then rise to $ 1,700 an ounce in 2022 and $ 1,650 an ounce in 2023. As of’s 2024, it will reach $ 1,620 per ounce per year. As a gold market analyst, we do not offer a glimpse into the global volatility of this precious metal, as this may give way to existing markets.

But the issue to consider is the entry of the world into a new phase of the economic system, in which the gold position will be lower than in previous years, and the reduction of geopolitical uncertainty will increase the balance in increasing the demand of the central banks.

 

*** Is global gold coming back from its peak?

Analysts believe that gold and silver will return to their recent peaks in the long run. “The US economy is facing a major challenge, with high costs awaiting the construction and strengthening of the Biden-era economic infrastructure. European bankers are also waiting for interest rates to fall, leading to the safe purchase of gold at lower prices. Will be found.

By the end of the year, with the implementation of these policies, gold is expected to return to the level of one million and six hundred thousand units. Regarding the long-term outlook for silver, it can be said that the metal may experience a drop of up to 30% in value, but expects to compensate for 10% of its loss by the end of the year and with increasing demand for minerals.

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