At some point, the fiat money producers will believe that fiat money is losing its value. There will not be an announcement, but there will be a slow adjustment. Look at the reserve assets held. Central banks are expected to reduce their exposure in dollars. They have already seen an increase in gold holdings. Now you have to be careful when looking at gold, because a large percentage of the increase in reserve exposure is not from more tonnes of exposure but through an increase in price.
That said, most central banks as of mid-June expect that gold will move moderately higher even after the poor second quarter. Will we see the highs from January and February this year? Unlikely, but there is more upside than downside for gold in the second half of the year.
No comments:
Post a Comment