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Real rates to drive gold prices higher - TD Securities

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(Kitco News) Real rates will ultimately drive gold prices higher, says TD Securities. “The yellow metal is torn between its safe-haven bona fides, which are prompting money managers to sell on risk-on behavior in markets, and its inflation-hedge characteristics, which are driving a swarm of capital to seek refuge in the yellow metal. Ultimately we anticipate that real rates will continue to drive gold prices higher as normalizing inflation expectations and suppressed rates vol provide fuel for the trade,” TD Securities commodity strategists write. In the meantime, silver has the potential to outperform gold, the strategists add. “The industrial-precious silver could outperform — benefiting from both the positive precious metals environment and its industrial characteristics, at a time when its supply may remain constrained,” they said. TD Securities expects the silver market to operate at “full or even above full utilization.”

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