According to Kitco - analysts at CPM Group issued a buy recommendation for gold on Thursday. These experts said that the initial upside target is $ 2,800 / ounce.
“The price increase reflects buying demand from institutional investors and, more importantly, investors' concerns about the political and economic outlook for the US and the world in 2025. In addition, there is growing speculation that US President-elect Donald Trump may impose import tariffs, including on gold and silver,” they wrote.
CPM predicts prices will continue to rise for at least the next few days. “Monday is a holiday in New York, while London remains open. President Donald Trump’s inauguration is also on Monday, and he has promised to sign a number of executive orders. Speculators think some of them could be tariff-related.
Gold prices could spike to $2,800 an ounce or higher. This could happen in the short term, meaning in the next few days," they noted.
Analysts also noted that the February Comex gold contract will begin delivery in late January, and many traders are shifting positions to the April contract.
As of Jan. 15, there were 28.2 million ounces of open interest in the February contract on the Comex, while there were 17.2 million ounces of open interest in the April contract. With about two weeks left in January, there is still room for prices to rise further as traders close out their February contracts and buy April contracts.
Total open interest reached 53.8 million ounces as of January 15, up sharply from 45.9 million ounces at the end of December. The large increase in open interest and rising prices suggest there is increased long-term buying.
They also pointed to the large volume of trading between London and New York. “Some physical gold traders actually bought gold in London and shipped it to New York. As the spread widened, speculators bought in London and sold in New York.
If the London market becomes particularly tense, London prices will rise sharply, reversing the price differential with New York. This reversal will lead to gold flowing back from New York to London," experts said.
Meanwhile, Bart Melek - managing director and head of global commodity strategy at TD Securities commented:
“Gold prices could fall a bit if the new US president mentions tariffs, which would suggest higher inflation and the US Federal Reserve would be seen as serious about its inflation target.”
According to Rich Checkan - President and COO of Asset Strategies International, gold prices will remain unchanged next week: "Everyone is adopting a 'wait and see' attitude towards US President-elect Donald Trump's policies and their impact on the economy. We need more time to assess more clearly."
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