Gold Price Forecast: XAU/USD eyes $1,600 amid rising rates and stronger USD – ANZ
16.09.2022, 11:46

Gold Price Forecast: XAU/USD eyes $1,600 amid rising rates and stronger USD – ANZ

Gold price has fallen steadily since March as central banks indicate tighter monetary policies for the rest of the year. Subsequently, economists at ANZ Bank have downgraded their XAU/USD short-term forecast to $1,600.

Haven demand remains subdued 

“We now think USD strength will last longer than we had thought. Labour resilience means the Fed will have to hike further than the market is expecting. Deteriorating liquidity conditions and higher US yields will feed haven flows and add risk premium.”

“Europe faces a serious energy crisis, which is a headwind for EUR and support for the USD. This makes us thinks the USD will peak in Q1 2023. In the face of sustained dollar strength, we see gold continuing to underperform.”

“Rising geopolitical and economic risks are doing little to entice safe-haven buying, with the USD still asset of choice. Nevertheless, the risk of either stagflation or outright recession could ultimately turn this around. Gold has traditionally outperformed in such environments.”

“We see further downside in the short-term. We have cut our short-term (0-3mth) target to $1,600.”

 

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