The recent rise in the Gold price cannot be adequately explained in fundamental terms, which is why a price correction is likely in the short term, strategists at Commerzbank say.
Will XAU/USD rally continue?
In the absence of a convincing explanation for Gold’s rally, we are sceptical that the precious metal will be able to sustain its gains in the short term.
In particular, if US interest rate cut expectations take a new blow, as they did on Tuesday following another strong reading on US inflation, many investors could be tempted to take profits and the recent moderate downward correction could continue.
However, it is unlikely that prices will fall back to the levels seen at the end of February as the Fed is expected to cut interest rates from June, which should support Gold. However, further upside potential is likely to be limited in the medium to long term. This is because a pronounced cycle of interest rate cuts in the US is unlikely, given the persistent risks of inflation.
We are therefore ‘only’ raising our Gold price forecast for the end of this year and the end of next year from $2,100 to $2,200.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
>>> Read full article>>>
Copyright for syndicated content belongs to the linked Source : FXStreet – https://www.fxstreet.com/news/gold-price-forecast-xau-usd-correction-is-likely-in-the-short-term-commerzbank-202403151446
