Quote:
Originally Posted by jyl
I think it has more to go. Many drivers for the long gold short dollar move
- Fed will cut rates 150-200 bp, lower short rates tend to pull down USD, lower USD boosts gold
- Inflation risk will rise as Fed turns to employment rather than inflation; gold is a hedge vs inflation
- Other Central Banks are diversifying from USD, especially China; foreign government demand for Treasuries is weaker; they are buying more gold
- Foreign private demand for Treasuries is still strong, but increasingly they hedge USD which pressures it down
- If US exports less, or if less trade is done in USD, then less trade-related demand for USD. The latter is gradually happening; when the financial structure is ready, it could happen suddenly.
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If it hits $4000 I'm selling!!