Market insights and analysis

How dynamic, risk-managed investment solutions are performing in the current market environment

2nd Quarter | 2021

Market insights and analysis

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Updates on how dynamic, risk-managed investment solutions are performing in the current market environment.

Last week, gold prices continued to find support around $1,900 per ounce. Prices closed the week at $1,905.20 per ounce, virtually unchanged from the previous week’s close (see the following chart).

According to Goldman Sachs, various factors—including a weaker U.S. dollar, inflation risk, and stimulus from central banks—are lining up to produce a surge in commodity prices in the coming year. This includes gold prices.

Reuters reports, “[Goldman Sachs] forecast a return of 28% over a 12-month period on the S&P/Goldman Sachs Commodity Index (GSCI), with a 17.9% return for precious metals. …

“Expansionary fiscal and monetary policies in developed market economies continue to drive interest rates lower and create demand for hedging the tail risks of inflation, lifting demand for precious metals, Goldman Sachs said in a note.

“Goldman forecast gold prices at an average of $1,836 per ounce in 2020 and $2,300 per ounce in 2021.”

Rick Andrews is president of Avant Capital Management.



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