Gold Price Forecast: XAU/USD unlikely to make any great advances – Commerzbank
26.01.2024, 14:04

Gold Price Forecast: XAU/USD unlikely to make any great advances – Commerzbank

What ultimately matters more for the Gold market is when and how much the US Fed cuts interest rates, strategists at Commerzbank say.

Fed unlikely to fuel hopes of rapid interest rate cuts

Institutional investors tended to sell Gold last year as the large ETF outflows indicate: According to the World Gold Council (WGC), a good 55 tons were sold off in the final quarter of the year; the total outflow is likely to have been just under 245 tons last year. This trend, which tends to weigh on prices, has continued into the new year. However, we assume that sentiment will turn as the year continues and that this group of investors will increase their positions again as soon as interest rate cuts are within reach. 

However, the Fed is unlikely to hint at this after its meeting next week: after all, it wants to see more success in the fight against inflation first. If the labour market report on Friday provides further evidence of this, the Gold price could rise again somewhat at the end of the week.

 

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