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RBC's Gero: gold buyers seeking inflation, stock hedges

Kitco News

Editor's Note: 2020 is expected to be another year of significant uncertainty and turmoil. But the question is what asset will emerge the victor when the dust settles from the global trade war, Brexit, recession threats, negative bond yields. It's a showdown of global proportions, so don't miss all our exclusive coverage on how these factors could impact your 2020 investment decisions.

Gold futures have hit their highest level since Nov. 5. “Gold buyers continue to seek assets that may be needed in the New Year as inflation hedges and stock hedges, as well as declining currency and buying-power hedges in many countries,” said George Gero, managing director with RBC Wealth Management. Further, he said, wage growth could signal U.S. inflation is coming, yet the Federal Reserve is expected to remain on hold with interest rates for most of 2020. Gero added that he is “still friendly to gold as we enter [a] new trading range with [a] good gain in the past year.” As of 8:46 a.m. EST, Comex February gold was up $7.20 to $1,512 an ounce.

By Allen Sykora of Kitco News; asykora@kitco.com

 

Price Futures Group’s Flynn: inflation expectations helping gold

Tuesday December 10, 2019 11:07

Gold is back above $1,500 an ounce, helped by expectations of building inflation and signs of strong jewelry demand, said Phil Flynn, senior market analyst with at Price Futures Group. As of 8:46 a.m. EST, Comex February gold was up $7.20 to $1,512 an ounce. “It’s more optimism on demand and more concerns about inflation,” Flynn said. “Central banks around the globe are very accommodative….Gold is pricing in increased prospective inflation going forward.” He also cited increased demand as reflected by stronger sales by jewelers such as Tiffany & Co. Tiffany estimated holiday sales rose between 1% and 3%, with the biggest boost coming from increased sales in China. 

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