Gold Price Could See One More Dip Before Bigger Rally

New York (Aug 21)  This week’s rally in gold has created renewed optimism in the marketplace; however, it might too early to call the bottom in gold as one research firm still expects the Federal Reserve to hike rates in September. In a note Friday, Simona Gambarini, commodity economist at Capital Economics says the firm expects to see one more drop in gold as prices hover around $1,155 an ounce. Comex December gold futures last traded at $1,156.10 an ounce. “While we acknowledge that the gold price could fall as low as $850 per ounce in a worst case scenario, our base case is that prices should find good support only a little below current levels (our end-Q3 forecast is $1,050) and will actually end the year higher, at $1,200,” says Gambarini. “We believe that demand and supply fundamentals remain solid and expect prices to recover further once markets have digested the first Fed move.”

Soiurce: KitcoNews