Gold might hit $4,600 mark by end of August
What's the story
Gold and silver prices could continue their upward trend as a weaker US dollar and a more dovish Federal Reserve are expected to boost demand for these precious metals. Peter McGuire, CEO of Trading.com, has predicted that gold could reach $4,600 by the end of August. The prediction comes amid a series of softer US economic data points such as disappointing non-farm payrolls and retail sales figures.
Market expectations
US dollar index to fall below 99
McGuire expects the US dollar index, which was around 99.50 at the time of his interview, to fall below 99 in the near future.
He said market participants will closely watch the minutes from the Federal Open Market Committee's last meeting and upcoming signals from the US Federal Reserve, including comments by its chair at Jackson Hole symposium.
Market predictions
Federal Reserve unlikely to hike rates in September
McGuire believes the chances of a Federal Reserve rate hike in September have diminished. He thinks the market could be heading toward the end of Q4 without a rate increase.
A weaker dollar, he said, could further bolster gold and other commodities.
He is also optimistic about silver, which was trading at around $65 an ounce after rising from some $57.
Metal forecast
Silver could reach $70 per ounce
McGuire noted that silver has gained about 15% and could continue its upward trend toward $70.
He said if gold hits $4,600, silver could easily go above $70.
The last few months of the year are likely to be favorable for precious metals due to expectations surrounding US interest rates, equity markets, and geopolitical factors.