(Kitco News) - Despite a strengthening U.S. dollar and rising interest rates, gold prices have shown remarkable resilience, signaling a potential climb to $3,000 an ounce, according to Ronald-Peter Stoeferle, Managing Partner at Incrementum AG.
Speaking at the Future Minerals Forum in Riyadh, Stoeferle highlighted a shift in the global gold market, with demand increasingly driven by emerging markets.
"The center of the gold world isn't in Zurich, in London, in New York anymore," Stoeferle said. "It's moving forward to Dubai, to Shanghai, to Mumbai, and also to Saudi Arabia".
He noted that Dubai is now responsible for 25% of the global gold trade, becoming the second-largest gold market in the world.
Stoeferle observed a different attitude towards gold in these emerging markets, where it is seen as "sound money" rather than a mere trade. This cultural affinity, similar to that in India, Turkey, and China, contributes to a consistent demand for physical gold, even during price dips. "The numbers are almost two thirds of physical demand that nowadays coming from emerging markets," he said.
The resilience of gold is especially noteworthy considering the current economic climate. Stoeferle pointed out that the U.S. dollar index is up 4.8% in the last three months. Traditionally, these factors would negatively impact gold prices, but they have not done so. "This would be like a horror scenario for the price of gold," Stoeferle stated, "but still the price of gold is holding up so well."
Stoeferle views the gold rally as only halfway done, with significant capital waiting on the sidelines, especially from Western financial investors who haven't yet participated in the rally. He added, "every small dip is being bought," reinforcing his confidence in future growth. He also noted that, according to their model, the price of gold will reach almost $3,000 this year.
Special thanks to our sponsor, the Future Minerals Forum (FMF), for making this coverage possible. Visit https://www.futuremineralsforum.com/ to learn more.
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