We think the next potential leg up in prices will in part be driven by an anticipated revival in demand for exchange-traded funds (ETFs), from which there were outflows in the first half of 2023. A rise in ETF Gold buying typically occurs just ahead of a US easing cycle – the timing of which we anticipate will become clearer by year-end as we get more data and the Fed decisions are behind us. 

Gold has also historically performed well when the USD softens, and we see another round of Dollar weakness over the next 6-12 months.

Gold still looks attractive to us as a longer-term portfolio hedge – especially in the context of an uncertain global growth outlook, volatile equity market dynamics, and unsettled geopolitics.