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Gold may drop below $1,200 in coming months - GFMS

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Mar 31, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    GFMS analysts at Thomson Reuters noted in their latest report published on Thursday, gold prices are expected to drop below $ 1200 – psychological barrier in near term amid Fed rate hikes and softening physical demand.

    Key Headlines from the report:

    Following three consecutive years of annual price declines, gold has recorded a blistering start to 2016

    Such an impressive performance has been largely attributed to a reduction in risk appetite among investors and fresh interest in safe haven assets

    We believe that the recent price rally will prove to be short-lived, and once current market turbulence starts to ease, we are likely to see the price retreat again, particularly as physical demand in key Asian markets is already weak

    The biggest drag on China's annual gold demand last year mostly took place during the first half, when the strong performance of the domestic equity market ... attracted much of the society's capital into the stock market

    The forecast reduction in global mine output and a gradual recovery in demand will see the physical surplus narrow in 2016, providing support to the gold price and laying the foundations for better prospects
    For more information, read our latest forex news.
     

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