Gold will respond positively in 2021 as concern shifts from ‘herd immunity to herd insolvency’
“Specifically we see ongoing US dollar weakness, deeper negative real rates in the treasury markets and a significant rise in unproductive debt as the Democrats open the spigots with fiscal stimulus as supporting factors. With the economy still contracting in Q1, we expect a bounce in H2 as the vaccine frees up the economy. With the recovery comes demand-pull as well as cost-push inflation further fuelled by the higher velocity of money, leading to expectations of much higher inflation, notwithstanding the weak labour markets.”
USAGOLD note: Ross Norman has finished high or won the annual LBMA price forecasting contest (including last year’s) so often, that one is forced to pay attention. For 2021, he sees $2025 as the average price, $1810 as the low, and $2285 as the high. Norman says physical demand for silver coins and bars will show “impressive gains,” reflecting ‘strong demand for safe havens in these troubled times.” For good measure, he sees $36 as the high for gold’s running partner – silver.
Repost from 1-21-2021