Wells Fargo Gives a Date: Gold Will Rise to Record Levels!

When it comes to gold, investors need to be patient. According to a US bank, while markets may continue to consolidate throughout the summer, the days when the precious metal shines are not far away.

Gold will fluctuate a bit over the next six months!

John LaForge, President of Wells Fargo's Real Asset Strategy, does not expect the Federal Reserve to cut interest rates until the end of the year. He says the market has seen concrete signs that the Fed's aggressive monetary policies are reaching their limits. LaForge notes that until then, the market will be at the mercy of natural ups and downs in the retail markets. He also points out that consumers in Asia, led by Chinese and Indian buyers, are a significant driving force for the physical bullion market, supporting prices close to record levels.

As you follow from Kriptokoin.com, due to the resilient strength of the US dollar, local currencies have weakened. During this process, gold prices have risen due to the intense demand from central banks and consumers seeking protection against inflation. However, according to LaForge, the yellow metal may be reaching the limit of this momentum. In this context, LaForge shares the following assessment:

If you are an Indian consumer, your gold has suddenly become 30% more expensive from New Year's until today. Generally, we see that consumers do not stop buying. They just buy a little less. So I think gold may fluctuate a bit over the next six months.

Wells Fargo's Latest Gold Forecasts

According to the updated mid-year price forecasts of the bank, it expects gold prices to trade between 2,300 and 2,400 dollars. It predicts that this range will rise to 2,400 and 2,500 dollars by the end of 2025. Looking ahead, while some investors expect the Fed to enter a easing cycle before returning to the gold market, LaForge says it doesn't need to be that clear. LaForge states that any kind of liquidity event or quantitative easing will be sufficient to push gold to all-time highs.

It may take one or two years, but the writing is on the wall when it comes to interest rates. Interest rates cannot rise any further. High interest rates will become a major problem for governments dealing with high debt levels. There will be pressure to prevent interest rates from climbing. Not only in the US, but also around the world, debts are piling up, which is why you see so many central banks turning to gold.

In this case, shiny metal will remain an option on the table!

Western individual investors continue to wait for the right time to enter the gold market. However, LaForge says he does not see such hesitation among official gold buyers. LaForge also adds that he expects central banks to continue buying gold because there are still years left in this new commodity super cycle.

In the current environment, high commodity prices will continue to drive nations to turn to gold to protect their wealth and purchasing power, while stubbornly keeping inflation pressures high. In this context, 'As long as debt is a problem, gold will remain an option on the table,' says LaForge, who sees solid potential for the shiny metal by 2025. Therefore, the analyst advises investors to maintain a well-diversified commodity portfolio.

Essentially, the bull supercycles are about the lack of sufficient supply to meet demand. In general, you can think of it as a tide that lifts all boats, and the worst strategic move you can make is to try to be too cute and prefer one asset over another. Rule number one: have a professionally managed commodity basket.

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