Natixis raises Gold price forecast for 2017

UNITED KINGDOM May 11 2016 6:38 PM

LONDON (Scrap Register): Gold could continue to perform well this year as the Federal Reserve pushes back the timing of its next interest rate hike; however, 2017 could be disappointing for investors, according to the latest report from Natixis.

Tuesday, the French bank significantly increased its gold forecast for 2016 and now expects prices to average about $1,185 an ounce this year, a 22% increase from its previous forecast in October. However, the bank is not very optimistic in the long-term, expecting prices to suffer in 2017 as the U.S. central bank raises rates.

For 2017, Natixis is expecting gold prices to average $1,060 an ounce, only up slightly from its previous forecast of $1,020.

In an interview with Kitco News, Barnard Dahdah, precious metals strategist for the bank, who was also the top forecast for the London Bullion Market Association for 2015, said that gold’s rally could end in the third quarter as that is when he expects the central bank to continue hiking rates.