RHJ/iStock via Getty Images
Anticipate a glittering rise in gold and silver as UBS precious metals strategist Joni Teves forecasts a further surge in 2024. Teves projects the yellow metal to attain $2,200/oz by year-end, propelled by the expectation of the Federal Reserve initiating interest rate cuts.
Despite recent assertions from the Fed dispelling prospects of a March rate cut, UBS remains steadfast in its belief in an impending policy easing by the Federal Reserve.
While the timing and scale of the projected Fed cuts remains uncertain, Teves states, “the market anticipates the Fed to ease policy and for U.S. rates to decrease.”
Beyond the imminent economic climate, the anticipation of surging macro volatility during a year hosting 76 elections for a staggering four billion voters elevates the appeal of allocating to gold as a hedge. Teves articulates, “We do think investors will start to build allocations to gold in an environment where there is a lot of macro uncertainty [and] geopolitical risks.”
Although not traditionally sought after as a geopolitical and safety haven when compared to gold, silver could ascend to exceptional heights if the Fed enacts easing policies, Teves suggests. In such a scenario, silver tends to outpace gold, leading Teves to opine that silver “could really shine.”
The UBS analyst acknowledges silver’s prolonged underperformance relative to gold, indicating an impending dramatic resurgence for the metal, describing the potential movement as “quite dramatic.”
As of Monday, front-month Comex gold (XAUUSD:CUR) for February delivery concluded at -0.5% to $2,025.70/oz, while front-month February Comex silver (XAGUSD:CUR) ended at -1.6% to $22.335/oz.
ETFs: (NYSEARCA:GLD), (GDX), (GDXJ), (IAU), (NUGT), (PHYS), (GLDM), (AAAU), (SGOL), (BAR), (OUNZ), (NYSEARCA:SLV), (PSLV), (SIVR), (SIL), (SILJ), (SLVP)
Gold prices experienced a decline, reaching a week-long low as the U.S. dollar strengthened. This trend follows more hawkish commentary from Fed Chairman Jerome Powell and a robust monthly jobs report released last week, extinguishing hopes for a March interest rate cut.
