Market Speaks: Gold Will Likely Remain Reactive To Real Interest Rates In Near Term Says WGC

8 Jul 2022 , 12:18 PM

The World Gold Council (WGC) stated in a latest update that the Gold prices will likely remain reactive to real interest rates in near term. Investors face a challenging environment during the second half of 2022, needing to navigate rising interest rates, high inflation and resurfacing geopolitical risks. In the near term, gold will likely remain reactive to real rates, driven by the speed at which global central banks tighten monetary policy in an effort to control inflation. WGC feels that rate hikes may create headwinds for gold, but many of these hawkish policy expectations are priced in. It also noted that continued inflation and geopolitical risks will likely sustain demand for gold as a hedge. Underperformance of stocks and bonds in a potential stagflationary environment may also be positive for gold.Powered by Commodity Insights