Following the announcement that the Gold Prices would end the IDemi period incentive measures in March, the US Central Bank recovered from early losses on Wednesday. Meanwhile, Morgan Stanley analysts say that easy returns for US stocks, loans and treasury bonds are over, but European and Japanese stocks will be worth in 2022.
“A significant break of this level can lead to a defeat,”
Spot gold prices increased by 0.4 %to $ 1,777.82 at the time of writing, while the US gold futures were traded at $ 1,784,70 at the latest increased by 1.14 %. Kriptokoin.comAs we have reported, the movement of the US central bank signaled that the inflation target has been achieved and paved the way for three interest rate hikes until the end of 2022. Tai Wong, a precious metal trader based in New York, makes the following assessment:
The Market Fed was waiting for a hawk move and they caught it in the dot graph. The market is satisfied with the Fed’s a little frightened and not wanting to stay far behind the curve. Lock technical level for gold prices are $ 1,750. A significant fracture of this level can lead to a defeat in the last days of the year.
Following the statement of the Fed, the gold prices fell by about 1 %at first to the lowest level of two months. However, the gold gathered with 0.2 %lower transaction by giving up the early gains of the dollar.
Is the end of weakness for gold prices?
In new economic estimates, the FED will work for 2.6 %next year as an inflation target compared to 2.2 %in September. Rising price prints increase the charm of gold because some investors see the gold as a precaution against high inflation.
FED President Jerome Powell also drew attention to the rapidly recovery of the US economy, but warned the Covid-19 pandema in the near term. Edward Moya, the senior market analyst of the Oanda brokerage house, thinks that the weakness of gold is approaching the end:
The risk of recession of the economy in 2023 does not seem unreasonable. The weakness of gold may be approaching the end, as the FED will be on the autop pilot until the March policy meeting.
Analysts recommend investors to be patient
According to Morgan Stanley analysts, the S&P 500 index may drop by 5 %in 2022 and other advanced markets can close the year higher. Therefore, analysts recommend that US stocks be given low weight, taking into account high values and more capture potential and less volatility in other parts of the world.
Analysts suggest that the 10 -year Treasury interest will exceed 2 %at the end of 2022, and proposing to weigh US treasures low. Analysts say that local developing market debts have begun to look interesting, but recommend investors to be patient:
At the beginning of the year, the US dollar and real interest rates will rise, investors will get a better entry point in the future of the year.
According to analysts, copper and zinc soften with better supply, while high real interest rates can lose their brightness of precious metals as they put pressure on gold. For strategists who point to cyclic and structural factors, aluminum continues to be the best choice.
