Due to concerns about the slowing growth of the US economy triggered by the PMI data from the manufacturing sector yesterday, the US stock market fell sharply, with the Nasdaq falling by more than 3%, while the price of gold fell in sync.

Gold prices are most likely to rise among commodities, according to Goldman Sachs analyst Stephen Quinn in a report titled "Go for Gold", with a target price of $2700 per ounce expected to be reached by early 2025.

Goldman Sachs predicts that gold prices will reach $2,700 in early next year based on three main reasons.

Goldman Sachs made this forecast based on the following three reasons:

American debt crisis: We believe that due to concerns about American financial sanctions and U.S. sovereign debt, global central banks have doubled their gold purchases since mid-2022, which is structural. This situation will continue regardless of whether the concerns materialize.

Fed rate cuts: The Fed's rate cuts will attract Western capital back to the gold market, as the momentum of a sharp rise in gold prices over the past two years has not materialized.

Hedge value: Gold provides important hedge value for portfolios to withstand geopolitical shocks such as tariffs, Fed risks, and debt concerns.

Regarding the central bank's gold purchases due to the US debt crisis, Krishan Gopaul, Senior Analyst at the World Gold Council (WGC) EMEA, pointed out that central banks around the world have been accumulating gold in recent months.

He said, "Despite the overall cooling of demand reported as gold prices continue to climb to new historical highs, the demand remains positive." This commitment continued in July, with a net increase of 37 tons in official reserves of global central banks, according to the International Monetary Fund (IMF) and public data. This represents a 206% increase, the highest monthly total since January (45 tons)."

According to CME's "Fed Watch," the probability of a 25 basis-point rate cut by the Fed in September is 61.0%, while the probability of a 50 basis-point rate cut is 39.0%.

According to Ping An Securities, historical data shows that within 6 months after the start of a rate cut cycle by the Fed, the average return of gold is significantly higher than other assets, with a win rate of 100%, showing an absolute advantage during the rate cut cycle.

According to data from Bank of America's Global Research Department at the end of August, there has been a net outflow of $2.5 billion from gold ETF funds so far this year. This indicates that the potential driving force behind the rise in gold prices comes from sources beyond traditional fund flows, namely central bank purchases. If the Fed begins to cut rates, it will attract Western capital back into the gold market and drive gold prices higher.

In terms of hedging value, Alamos Gold CEO John McCluskey identifies international political turmoil and uncertainty, as well as US debt issues and economic strength, as long-term factors driving gold prices to new highs.

"In the past few months, US debt has grown exponentially, now exceeding $35 trillion," he added. "Coupled with the Fed's expected interest rate cuts, the upcoming US elections, and increasing concerns about the US economy, these factors could further increase the potential upside for gold."

"I have publicly predicted that the price of gold will reach $2650 per ounce by the end of this year," said McCluskey, who has more than 35 years of experience in the gold mining industry.

Institutions are predicting further increases in gold prices.

The American Bank Commodity Strategy Team believes that the price of gold is in line with its original estimate and maintains its forecast that it will break through $3000/ounce next year. The Bank of America team issued a report at the end of last year estimating that the price of gold could test levels above $3000/ounce by 2025.

Gold prices reached a record high this year, exceeding $2500/ounce. Bank of America believes that despite the lackluster trading performance, there is confidence that gold prices will challenge the $3000 mark in the next 12 to 18 months.

The team believes that the driving force behind the future rise in gold prices is not commercial buying, but non-commercial demand. The report points out that the increase in funds flowing into gold-linked exchange-traded funds (ETFs) and the rise in settlement volume in the London gold and silver market reflecting strong demand. Bank of America's interest rate strategy team pointed out that the possibility of a rate cut by the Federal Reserve could lead to significant fluctuations in bond yields and also have a positive long-term effect on gold prices.

Macquarie expects that the Federal Reserve will enter an interest rate cutting cycle, and recent weak economic data will trigger more aggressive or larger-than-expected policy easing, which will continue to support the strength of gold prices. The bank's commodities team currently predicts that gold prices will continue to rise, reaching $2277 and $2425 per ounce in the next two years, emphasizing that gold is a short-term winner. The report points out that gold outperformed most other commodities in the past year, with only a slight decline in early August. With the upcoming rate cutting cycle, concerns about whether the economy can achieve a 'soft landing' are increasing, and there is still room for gold prices to rise.

How to seize the opportunity of rising gold prices? As gold ETF trading is convenient, liquid, and available for online trading during the trading session, investors can capture the opportunity of rising gold prices by investing in ETFs.

In terms of Hong Kong stocks, Macquarie released a research report stating that it is giving its first recommendation to $ZHAOJIN MINING (01818.HK)$Please use your Futubull account to access the feature.$SD GOLD (01787.HK)$ Nvidia. $ZIJIN MINING (02899.HK)$ "Outperform the market" rating, with target prices of HK$18, HK$19, and HK$21 for listed in Hong Kong stocks, with Zhaojin Mining listed as the top pick.

As for the US stock market, $Harmony Gold Mining (HMY.US)$ In a statement released on Monday, the company stated that with gold prices repeatedly hitting new highs and the increasing gold production of this major global gold producer, the profit scale (i.e. earnings per share) in the previous fiscal year may increase significantly by 78% year-on-year. The company expects earnings per share for the fiscal year ending in June to reach as high as ZAR 13.88 (approximately USD 0.78), far exceeding last year's fiscal year earnings per share of ZAR 7.80. Harmony Gold will officially release its financial report on September 5th.

As for gold ETFs, potential gold ETFs worth considering according to Michael Hartnett, Chief Investment Strategist at Bank of America, include $ISHARES GOLD TRUST MICRO (IAUM.US)$ and $Spdr Gold Minishares Trust (GLDM.US)$ , Hartnett called it "top-notch". For the specific differences between different gold ETFs, please refer to the following content:

In addition, mooers can click on "Market> ETF> Thematic ETF> Gold ETF" in Futubull to view gold ETFs in the market.

Editor/Jeffy