The correction of the Gold price has been pronounced. In the opinion of strategists at Commerzbank, investors on the Gold market are likely to remain hesitant after the price dip.
Forecast of the mid-year Gold price lowered to $1,800
“Hopes of an end to the rate hike cycle in the near future in the US have turned out to be premature. Currently, a troy ounce of Gold costs a good $130 less than it did at the beginning of the month. Presumably, a number of investors have had their fingers burnt.”
“In response to the Fed’s steeper rate hikes – we now expect rates to peak at 5.5% – we have lowered our forecast of the mid-year Gold price to $1,800 (previously $1,850).”
“A lasting recovery should ensue in the second half of the year, however, as the US economy is then likely to experience a dip that will probably spark renewed expectations of rate cuts. We are therefore sticking with our year-end forecast of $1,950.”