Gold price to rise amidst volatility

Gold prices are expected to rise this year amidst volatile markets and a global economic slowdown, said Standard Chartered Bank.

Its chief investment strategist Steve Brice said gold and gold equities remain the bank’s favoured investments to manage the threat of a loss of purchasing power.

“Within the equity space, we believe gold-related companies will also provide a good hedge against inflation.

We have seen considerable underperformance of gold equities versus the underlying commodity over the past 18 months.

As gold price assumptions are adjusted higher, we expect gold stocks to play catch-up with gold.

“We remain overweight on both gold and gold equities to help mitigate the potentially deleterious effects of inflation on investment portfolios,” he said.

Speaking to reporters at a market outlook briefing last Friday, Brice said gold prices are expected to hit US$1,975 per ounce by the fourth quarter. Last week, gold prices were about US$1,750 per ounce.

He added that gold is favoured for several reasons, including diversification, protection against inflation and good returns.

From: The Sun Daily