Gold Outlook Remains Bullish with More Room for Fresh Long Positions - ANZ

Overview

ANZ has reiterated its bullish outlook for gold, suggesting that there is potential for new long positions as the precious metal aims for a renewed push above $5,200. The firm highlights that the fundamental factors supporting gold have remained consistent since last year, but they are now emphasizing a "less crowded" investor positioning following a profit-taking phase in late January.

Key Insights from ANZ

• Monetary Policy: ANZ expects accommodative monetary policy to persist until Q4 2026, predicting that the Federal Reserve will resume interest rate cuts in Q2, likely in June, and implement another cut in Q4. This would lower the terminal rate from 3.75% to 3%, which is favorable for non-yielding assets like gold.
• Geopolitical Tensions: Renewed tensions between the US and Iran are anticipated to increase demand for gold as a safe haven. Additionally, ongoing discussions regarding Russia and Ukraine are expected to contribute to market volatility.
• Economic Risks: The article notes that economic risks are still present, particularly as markets have yet to fully react to increased US tariffs. There are also concerns regarding financial risks associated with the AI-driven equity rally.
• Investor Positioning: After the recent profit-taking, investor positioning in gold is described as less crowded, which provides ample opportunity for investors to establish new long positions.

Conclusion

In light of the current economic and geopolitical landscape, ANZ believes that gold remains a compelling hedge against market risks. The combination of favorable monetary policy, geopolitical tensions, and less crowded investor positioning supports a bullish outlook for gold in the near future.