While investor demand for gold has been sluggish throughout 2024, sentiment appears to be changing, with skeptics of gold’s bullish outlook starting to be convinced as the precious metal has rallied more than 30% this year, according to Kitco.
Robert Armstrong, an American financial commentator at the Financial Times, said he may be the latest to turn to the precious metal. Speaking at the 2024 Global Precious Metals Conference of the London Bullion Market Association, he noted the appeal of gold in times of turmoil:
“The only gold I own is the cufflinks I wore this morning. But now, I think it's time to buy," said Robert Armstrong.
In a comment to Kitco News, Armstrong clarified that this is just his personal view of the market. While he sees value in gold, it is still a complicated trade: “When things go bad, gold seems to do well.”
Armstrong added that the downside to investing in gold is that investors need to hold for a long time to benefit. As for investing in gold, his personal view is that gold is overvalued. And investors are better off buying when prices fall rather than chasing the market.
While Armstrong may be looking for a buying opportunity, he noted in his presentation that the metal's rally is supported by strong fundamentals as economic and geopolitical uncertainty remains extremely high.
He pointed out that there are signs that investors are starting to accumulate gold as a liquidity channel and hedge against market downturns.
Looking beyond consumer demand, Armstrong said central bank demand is another reason gold could continue its current uptrend. He added that it would not be surprising if countries began to diversify away from the dollar.
However, Armstrong also noted that he does not expect the dollar to lose its reserve currency status anytime soon. Armstrong also noted that fears of a US debt crisis may be overblown. He pointed out that even with a deficit of over $35 trillion, investors are still buying US bonds.
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