Analysts from ABN Amro report: “Gold investors will have to wait at least one more year before they can expect to see a sustained recovery of the gold market."
ABN Amro's forecast for 2016 says about further weakening of gold and silver at the beginning of 2016. According to them, the price will drop below $1,000 per ounce of gold and below $13,5 per ounce of silver.
Major factors of pressure on the gold market are the strengthening US dollar and tightening monetary policy of the Fed .
“We expect investors to continue to liquidate positions in the months ahead because of a higher US dollar and higher U.S. rates. It is likely that new lows in prices will be reached before the end of the first quarter of 2016. We expect the Fed to raise rates very slowly in 2016, but even this scenario is not priced into markets. A rise in U.S. Treasury yields should push gold prices towards USD 900 per ounce or even below.”
Despite the fact that analysts are negative on the gold for the coming year, they note that there is potential for short-term periods of growth."Gold prices may be supported in waves of risk aversion. However, when there is systemic risk in financial markets it will not behave as the ultimate safe haven asset. For example, at the height of the global liquidity crisis (when there was a shortage of liquidity) gold prices dropped sharply because investors valued cash more than gold," experts write.
Analysts do not expect gold and silver prices to recover before the third quarter of 2017.
