Goldman Sachs continues to see prices rising over the next year as demand in China and other emerging-market nations recover. In a report, Goldman reiterated its forecast for the precious metal to rise to $1,450 by the end of 2019.
Jeff Currie, global head of commodities with Goldman Sachs said “Going forward gold will be supported primarily by growing demand for defensive assets. The same is also true of central-bank buying, with rising geopolitical tensions incentivizing more central banks to re-enter the gold market.”
The investment bank maintained its positive recommendation and raised its 12-month price forecast noting that “expected growth is supported primarily by growing demand for defensive assets, with a slower pace of Fed rate hikes in 2019 boosting demand.”
The World Gold Council (WGC) made a similar case in its 2019 outlook, predicting that “global investors will continue to favor gold as an effective diversifier and hedge against systemic risk.”
The rise in protectionist policies around the world is chief among the risks since they tend to lead to higher inflation and slower economic growth over the long term, according to the WGC.
Some believe the current government shutdown, over funding for a wall along the southern border, is evidence of the risks protectionist policies pose.
Furthermore, central-bank gold demand, which saw strong growth throughout 2018, will continue to be a dominant theme in the marketplace.
To conclude, Precious Metals United is confident that “Gold will continue to shine as a safe-haven asset as Growing recession fears continue to ripple through financial markets.”