During Wednesday's Asian session, gold continued its uptrend from yesterday, approaching the 2480 level. With the gold price setting new historical highs, Abrdn's Head of Investment Strategy, Robert Minter, said the party for gold has just begun. He pointed out that the market expects the Fed to cut interest rates, which is driving gold prices to new records. Product structure-wise, operating income for 10-30 billion yuan products are 401/1288/60 million yuan respectively.

In an interview, Minter said that Powell's testimony to Congress last week seemed to be the turning point that the market had been anticipating. Powell told congressmen that the risks facing the economy are now balanced and that high inflation is not the only issue.

After Powell made the above remarks, gold successfully held on to its support level of $2,400 and continued to set new highs this week.

The rise in gold prices is occurring at a time when the market is almost fully pricing in an interest rate cut by the Fed in September.

Minter said he was not surprised that Powell and the Fed are shifting their focus away from inflation. He noted that rising consumer debt under high-interest rate environments poses a significant risk to the economy.

Minter pointed out that higher interest rates are increasing the pressure on car loans and credit card interest.

"It's not just the federal funds rate, it's not just the benchmark rate. Many credit market products have higher interest rates than before, which means a smaller economic cushion. Just a little labor market pressure can trigger big problems," he said.

Despite the increasing risks, Minter believes that the Fed still has the possibility of avoiding a recession, which is why gold has huge potential. He said, "The Fed is lagging behind the situation and will eventually cut interest rates faster and more aggressively to catch up. This is a strong basis for cutting rates in September."

Minter said that under this scenario, the demand from investors for a major increase in gold prices is only a matter of time. As for how high the gold price can rise, Minter added that he is no longer focused on specific price targets because he is more concerned about trends and upward potential.

At a record high, the gold price has risen more than 19% by 2024, but Minter said this is just the beginning of gold's full upward potential.

He pointed out that gold ETF holdings have decreased to the level of 2019. Minter said that this trend has started to reverse and will only accelerate when the Fed initiates a new easing cycle.

"Powell's comments last week invited investors to participate in the gold party. Looking back at the past three federal funds rate cycles, they led to gold price increases of 57%, 235%, and 69%, respectively," he said.

At the same time, Minter does not expect central banks around the world to stop buying gold in the short term, as they are still diversifying their investments away from the US dollar. He pointed out that emerging market central banks hold only about 5% of their foreign exchange reserves in gold, while developed country central banks hold about 12%.

While gold has attracted the most attention, Minter said he is also bullish on silver and copper. When investors are chasing the trend of artificial intelligence, he said that few people pay attention to the infrastructure needed to support this new technology.

He explained that to meet the growing energy needs, the world will need more copper.

At the same time, he expects that as the momentum of the precious metal market increases, silver prices will surpass gold prices. He said, "Looking back at the past three interest rate cycles, in 2000, gold rose by 57%, but silver rose by 65%; in 2006, gold rose by 235%, but silver rose by 318%; in the end of 2018, gold rose by 69%, but silver rose by 101%."