Gold at $1,500: Possible if US Fed downgrades rate forecast

UNITED STATES July 13 2016 4:31 PM

NEW YORK (Scrap Register): TD Securities sees $1,400 gold and says $1,500 may even be possible if the Federal Reserve further cools market expectations for interest rates. 

The metal has benefited from the disarray caused by the U.K. after its vote to leave the European Union, as well as global disinflation and low interest rates. 

Given that there are likely to be significant flows into gold and other precious metals seeking protection from the current turmoil, the record amount of net-long exposure should not impede the yellow metal from trending toward $1,400 an ounce.

“If we see the Fed downgrade its rate forecast in the not-too-distant future, a move toward $1,500 an ounce is also very possible, particularly if the negative yield narrative grows even louder,” said analysts at TDS added.