Gold Price Forecast: XAU/USD to find support from negative real yields and inflation fears – ANZ

The macro backdrop for gold is being challenged by fears of fiscal tightening. Nevertheless, negative real yields and rising inflation should offset those headwinds, according to economists at ANZ Bank.

Inflows in gold-backed ETFs are steady

“The macro backdrop for gold is being challenged by fear of fiscal tightening. But negative real yields and rising inflation should offset those headwinds.”

“Negative real yields appear to be driving gold prices in the face of a stronger USD. We expect US dollar to weaken as other central banks hike rates.” 

“Inflows in gold-and silver-backed ETFs are steady as talk of fiscal tightening increases. Lean speculative positioning in both gold and silver leaves room for a price rise.”

“Physical demand is recovering from a fall when India was battered by a second wave of COVID-19.”