Outlook for gold - "gold’s story is not yet over"
A client note via RBC on the metal, the bank sees factors still prevalent to support the price ahead:
While we may have seen a reset of sorts in gold’s valuation, its path is not predetermined as we barrel towards 2021
- While the market seems to have priced in a new normal for now, prices remain elevated beyond where many macro drivers would imply on their own, as uncertainty still pervades.
- even putting the risk of a viral resurgence aside, an effective vaccine will take time to distribute, the economy will take time to recover, and prolonged political uncertainty remains a worry.
- While investor flows as measured by ETF flows have levelled out for the most part, we believe that there is still a clear appreciation for gold amid all the uncertainty that still persists.
- Thus, while the "light at the end of the tunnel" may indeed have capped most of the upside risk, risks remain and gold's story is not yet over in our view.
Annual & Quarterly Price Forecasts from RBC: