Gold gained significant momentum in early 2022 as inflation surged to multi-decade highs in the United States and in other countries in the developed world. In response, the U.S. Federal Reserve pursued the most aggressive interest rate tightening policy in nearly two decades. The yellow metal suffered as a result, dropping to levels it had not seen since the start of the COVID-19 pandemic.
The top play in the precious metals space managed to regain its stride this year. Gold climbed back above $2,000/ounce by the spring of 2023. It suffered a dip in late September and early October, only to bounce back once again and hover around the key $2,000 per ounce mark. Where is the yellow metal headed for the rest of 2023 and beyond?
“I think it’s pretty clear that gold hasn’t been supported by further heightening tensions,” said Adam Button, chief currency strategist at Forexlive.com. Meanwhile, Button is optimistic that the recent hold on interest rates from the US Federal Reserve is promising. “I think the message from the market this week is that the Federal Reserve is done,” Button said. “And that’s great news for gold.”
That could also be good news for gold producing equities like Barrick Gold (NYSE:GOLD). Barrick, the second-largest gold producer on the planet, has seen its stock climb 13% year-over-year as of close on Friday, November 3. This is a stock to watch closely as gold continues to show strength ahead of the U.S. holiday season