Goldman Sachs: Gold Could Surge 9% to Hit $1,600 Per Oz

SEATTLE (Scrap Monster): Goldman Sachs- the leading global investment bank, in a research note published last week, said that prices of gold could jump higher by 9% next year to touch $1,600 per oz. The yellow metal is most likely to hit those levels within a time span of 12 months. Also, Goldman Sachs has maintained its earlier gold price forecasts for periods up to one year.

The Goldman analysts stated that they remain optimistic about gold in the coming year. The investors across the globe view gold as a safe or haven asset, especially during the ongoing turbulent times. The heightened political uncertainty will likely boost the investment demand for gold as a defensive asset, they noted. The bullish forecast is also based on gold’s status as an asset not correlated to other asset classes like stocks and predicted higher returns on gold when compared with bonds.

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According to Mikhail Sprogis, precious metals analyst at Goldman, gold is likely to get support from uncertainties arising out of continued trade tensions, protests in Hong Kong and elsewhere as well as the upcoming U.S. elections. Gold’s best times come during times of uncertainty, he added.

The research note lists out key reasons behind its expectations for a higher gold price in 2020. Firstly, political uncertainties and fall in consumer confidence are likely to lead to stock market decline in 2020, which in turn will benefit gold. Also, greater household savings in developed countries will result in more spending on gold.