Gold Could See $2,500
There’s still plenty of upside ahead for gold stocks.
Even after running to $2,000 earlier this year, Goldman Sachs says gold could run to $2,500 by the end of the year—especially with fears of a potential recession.
That being said, we’d use weakness in related gold stocks, as a goldmine opportunity.
According to Jeff Currie, Goldman Sachs global head of commodities research, as quoted by Bloomberg, “It’s a perfect storm for gold right now.”
“There’s three legs to this story. One, you have strong investor demand for gold over concerns about inflation, recessions, downturn in places like Europe. The second leg is central bank buying … and with the situation in Russia, they’re likely to accumulate dollar in reserves they can’t do anything with. What can they do with it? Buy gold. Then you have central banks in places like China and Turkey diversifying for de-dollarization reasons. Then you have diversification reasons in places like Brazil and India.”
With plenty of uncertainty in coming months, investors are likely to buy more gold to hedge against issues such as rising inflation, geopolitical issues, and potential economic downturns. Plus, with the coronavirus still wreaking havoc, it could drive even more safe haven demand.