Part of the content of this article is comprehensive from Zhitong Finance, Jin10 Data, etc.

On Monday (April 1), spot gold opened above the $2,240 mark, reaching another record high. In early trading in the Asian market, spot gold expanded its gains. It rose 1% during the day, breaking through the 2,250 US dollar mark, maintaining the trend of gold prices repeatedly reaching new highs over recent trading days. COMEX gold futures topped $2,270 per ounce.

The price of gold is ushering in a “point of increase in gold”

As a safe-haven asset in the traditional sense, gold usually performs best during periods of falling global interest rates and geopolitical turmoil, so according to some analysts, gold is ushering in a “golden upward period.”

Many global markets were closed last Friday, but a major data released last Friday suggests that the Federal Reserve is getting closer to cutting interest rates this year. The data shows that the Federal Reserve's most popular potential inflation indicator, the core PCE data, cooled down in February. Excluding food and energy, the core PCE price index grew 2.8% year on year in February, the lowest level since March 2021. It remained flat with market expectations. The previous revised value was 2.9%.

According to many analysts, this further shows that although the Federal Reserve has maintained the trend of cutting interest rates cautiously, policy makers may be relieved to reduce borrowing costs this year. Investors in financial markets usually start buying large amounts of gold before the Federal Reserve cuts interest rates, because the prices of non-yielding assets such as gold and silver often perform well in a low interest rate environment.

After the release of the core PCE data, the CME “Federal Reserve Watch Tool” showed that the probability of the Fed cutting interest rates in June was as high as 66%, suggesting that most interest rate futures traders are betting on cutting interest rates in June. At the same time, traders are betting that the Fed will cut interest rates 3 times this year, for a total of 75 basis points — in line with the rate cut expectations suggested in the FOMC bitmap for December and March last year.

In the interview, Powell stressed that the Federal Reserve is in no hurry to cut interest rates, hopes to see more “positive” inflation data to boost confidence, and will continue to carefully grasp the timing of interest rate cuts. Powell said that now the Federal Reserve is facing a double whammy. On one side are economists and investors who are eager to cut interest rates for the first time, and on the other, those who are more cautious. Both sides are evenly matched. “We will be careful with this decision because we are capable of doing it. We want more confidence before taking steps to cut interest rates.”

Powell also believes that the probability of an economic recession in the US is not high, and there is no reason to think that the US economy is already on the verge of recession. “We are in a strong economy and a good labor market. There is no reason to think the economy is in recession or on the verge of recession. The US economy is growing at such a steady rate, and the labor market is still very, very strong, which gives us more confidence that inflation will fall before we take the important step of cutting interest rates.”

Multiple factors support the rise in gold prices

Gold is one of the world's major commodities with good price performance so far in 2024. The spot price of gold rose by more than 8% in the first quarter. In addition to the central logic that major global central banks such as the Federal Reserve may relax monetary policy soon, investors concerned about gold as a precious metal usually want to hold gold in times of economic and political uncertainty; the upcoming polarized US presidential election and the ongoing geopolitical conflict between Ukraine and the Gaza Strip clearly meet this requirement. More importantly, strong physical buying forces from major Asian central banks and investors have also been a key pillar supporting the price of gold.

Gold assets have long been viewed as a safe haven during difficult economic times, especially when people are concerned about the safety of the country's cash. Gold is almost universally accepted as an asset, making it equivalent to foreign exchange when the government is restricted from using other currencies. Russia is now facing another round of comprehensive escalation of sanctions from Western countries, plus pressure brought about by Western countries since the imposition of comprehensive sanctions in 2022. Domestic currency liquidity continues to face huge threats, so demand for this precious metal by the Bank of Russia and some Russian households has increased dramatically since the Russian-Ukrainian conflict.

Wall Street giants sing for more gold

It can be said that the positive outlook for gold has been recognized by most major Wall Street banks. Among them, J.P. Morgan Chase said in a research report last month that gold is the bank's preferred investment target in the global commodity market. J.P. Morgan expects the spot price of gold to reach 2,500 US dollars per ounce this year.

Goldman Sachs, known as the “commodity standard-bearer,” exclaimed that the price of metals such as gold will continue to rise this year. On March 28, Goldman Sachs analysts Nicholas Snowdon and Lavinia Forcellese pointed out in their report that by the end of the year, copper will rise to 10,000 US dollars per ton and aluminum will rise to 2,600 US dollars per ton. At the same time, gold is expected to rise to 2,300 US dollars per ounce. Goldman Sachs pointed out that under the influence of multiple factors such as monetary policy shifts and geopolitical factors of European and American central banks, gold is expected to continue its upward trend at the end of 2023 and the beginning of 2024.

According to another major Wall Street bank, Citigroup's research report, the price of gold may soar to $3,000 per ounce in the next 12 to 18 months, all depending on three possible catalytic factors. Aakash Doshi, head of North American commodity research from Citigroup, said that if the world's major central banks drastically increase gold purchases, global stagflation occurs, or if there is a deep global recession, the price of gold may rise by about 50%.

David Neuhauser, founder of Livermore Partners, said, “My goal is for gold to reach $2,500 by the end of 2024.”

International gold price frenzy, what investment opportunities can we pay attention to?

Analysts said that as the price of gold continues to hit new highs, gold-linked stocks have continued to move upward. The following are the gold-related investment targets for Hong Kong and US stocks compiled by Futu News for your reference:

• US gold stocks and ETFs

Gold ETF:

$SPDR Gold ETF (GLD.US)$,$VanEck Gold Miners Equity ETF (GDX.US)$,$VanEck Junior Gold Miners ETF (GDXJ.US)$,$Ishares Inc Msci Global Gold Miners Etf (RING.US)$,$Sprott Physical Gold Trust (PHYS.US)$,$Gold Trust Ishares (IAU.US)$.

Among them,$SPDR Gold ETF (GLD.US)$It is one of the most liquid commodity ETFs. It began trading in 2004, expanding the potential market for gold. Prior to GLD, investors in the gold market were limited to physical gold bars and coins, futures contracts, and gold mining stocks.

Leveraged products:$MICROSECTORS GOLD MINERS 3X LEVERAGED ETN (GDXU.US)$,$Direxion Daily Junior Gold Miners Index Bull 2X Shares (JNUG.US)$,$Direxion Daily Gold Miners Index Bull 2X Shares (NUGT.US)$.

US gold stocks:

$Barrick Gold (GOLD.US)$,$Franco-Nevada (FNV.US)$,$Agnico Eagle (AEM.US)$,$Sibanye Stillwater (SBSW.US)$,$Gold Fields (GFI.US)$,$Newmont (NEM.US)$,$Agnico Eagle (AEM.US)$,$SSR Mining (SSRM.US)$.

• Hong Kong gold stocks and ETFs

Gold ETF:$SPDR Gold Trust (02840.HK)$,$Value Gold ETF (03081.HK)$,$Hang Seng RMB Gold ETF (83168.HK)$.

Hong Kong gold stocks:$ZIJIN MINING (02899.HK)$,$ZHAOJIN MINING (01818.HK)$,$CHINAGOLDINTL (02099.HK)$,$SD GOLD (01787.HK)$,$LINGBAO GOLD (03330.HK)$.

edit/ruby