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Standard Chartered: retail demand to lead gold prices higher; 2Q Avg. put at $1,725

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Standard Chartered looks for the next leg higher in gold prices to be led by physical demand. Gold prices initially fell with equities when traders needed to sell other assets to raise cash, but the metal bounced this week, including its largest gain on Tuesday since 2008, boosted by aggressive Federal Reserve monetary accommodation. Recent signs of stabilization in stocks bodes well for gold, said Standard Chartered precious-metals analyst Suki Cooper. The bank noted that U.S. Mint data show that coin sales in March have already surged to three-year highs. “As highlighted previously, we believe the next leg higher in gold is likely to be driven by retail demand; there are now signs it has started to pick up,” Cooper said. “We maintain our view that price risks remain to the upside barring profit-taking and expect prices to average USD 1,725/oz in Q2-2020.”

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