Gold to remain supported as U.S. yields are on downward trajectory: TD Securities
While it is still unclear how hawkish or dovish the Federal Reserve will be this year, the ECB’s easing “bazooka” is unavoidable, which will push EU yields much lower, according to TD Securities. “A ‘bazooka’ of monetary stimulus from the ECB is set to push EU yields deeper into negative territory. After all, playing hot-potato with negatively yielding European debt isn’t particularly risky, when you can unload your potatoes on your friendly central banker,” TD Securities strategists say. In this environment, U.S. yields are also looking to head lower. “U.S. yields would eventually return on their downward trajectory, suggesting that gold’s luster would once again reappear,” the strategists write.