What is the outlook for gold in 2017? After years of declines, all that glittered in the first half of 2016 was gold. But it was a different story in the second half of the year, with gold giving up much of its gains.
Where will gold prices go in 2017? Predicting the price of gold is never easy. A new U.S. president it about to enter the Oval Office. His policies, while embraced by Wall Street, are untested. Geopolitical tensions are fraught, and the U.S. economy remains fragile, which are all good for gold prices.
At the same time, U.S. economic data is encouraging, stocks are at record levels, interest rates are up, and many believe that Donald Trump’s economic policies will be good for corporate America, which is bad for gold prices.
So again, the predictions for where gold prices will go in 2017 vary wildly. In 2016, gold prices soared in the first half of the year on fears of a global recession and uncertainty surrounding the Brexit vote. Between January and July, gold prices advanced more than 23% to around $1,380.00 per ounce.
In the second half of the year, gold prices declined slightly on improving U.S. economic data, but cratered after Donald Trump won the election. Gold ended the year up roughly 8.5%. That’s a good year for a commodity like gold, but it still ended the year on a down note.
Most analysts expect gold prices to climb around 13% in 2017, which would lift gold prices to a high of around $1,500. Looking ahead though, there are a large number of factors that could propel gold prices significantly higher than that in 2017.
Gold is a hedge against economic uncertainty, and there were more than enough reasons for investors to hedge against political and economic uncertainty in 2016 and protect their assets. At the start of 2016, investors and central banks loaded up on gold as the markets started to tumble on fears of a global recession. Gold prices got another boost in June when the U.K. voted to leave the European Union (EU).
Will investors turn to gold in 2017? Despite unbridled optimism about President-elect Donald J. Trump and rising consumer confidence, the world is an unpredictable place, and any number of events could send investors flocking back to gold in 2017.
Unexpected outcomes in Hong Kong’s Chief Executive Election on March 26, France’s Presidential Election, with the First Round on April 23 and Second Round on May 7, and Germany’s Federal Election on October 22 could all propel gold prices higher.
There are also a lot of other unknowns that could erupt in 2017 and send gold prices soaring. America’s relationship with Russia and China is icy. The U.S. could enter a trade war with China. Russia could extend its reach into Ukraine, and North Korea could push ahead with its plans to test-launch an intercontinental ballistic missile. Ongoing issues in the Middle East and terrorist attacks could also send current gold bears scurrying back into gold.
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