Gold has risen in price moderate, departing from two-week low as the dollar rally stalled and European stocks fell, which increased investors’ appetite for safe assets. Support prices have also hopes that the Fed will not raise interest rates at the June meeting.
According to analysts, in the near future, the level of $ 1,300 will act as a strong barrier. It is worth emphasizing, since the beginning of the year the precious metal quotes have increased by almost 20 percent against the background of large-scale gold inflows to funds and reduce the likelihood of Fed rate increase in the near future. Recall increase in rates is usually a negative impact on gold prices as the precious metal can not compete with the assets, income, when borrowing costs rise.
“The increase in gold prices will be limited, as the Fed little chance to surprise the markets” in a bad way “, and the space for the weakening of the dollar also has its limits”, – experts said Goldman Sachs. However, Goldman Sachs increased its forecasts for gold prices in the coming months, citing the strong net speculative positioning. According to the new estimates, the price of gold will be $ 1,200 in three months, $ 1180 in six months and $ 1,150 in 12 months. Previously, prices were projected at $ 1,100, $ 1,050 and $ 1,000, respectively. Also, Goldman Sachs analysts expect that the Fed will raise rates in September, but also do not exclude such a possibility at the July meeting, if the US economy will show steady growth. Meanwhile, according to the quotations of futures on a bet the Fed, traders estimate the probability of a July rate increase of 21%.
The cost of the June gold futures on the COMEX rose to $ 1275.7 per ounce.
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