Gold’s Haven Appeal Burnished by Drumbeat of Growth Warnings

Gold may be heading for another rally, with warnings over a global economic slowdown paving the way for a fresh push toward $2,000 an ounce.

A potent mix of decades-high inflation, geopolitical turmoil and growing talk of recession should be bullish for the traditional haven, according to speakers interviewed ahead of a precious metals conference in Singapore this week.

Bullion is down about 10% from a peak in mid-March, after the concerns that Russia’s invasion of Ukraine might sprawl into a broader conflict dissipated. But with top banking executives now warning about fresh economic shocks, the situation is ripe for stagflation, which would be bullish for gold.

“After decades of massive deficit spending and ultra-loose monetary policies, we are heading toward a period of stagflation,” said Gregor Gregersen, founder of Silver Bullion Pte. “In this kind of environment, safe-haven assets like physical gold and silver are some of the best things you can own.”

Gregersen predicts gold and silver could rise to around $2,000 an ounce and $26 an ounce respectively by the end of the year, and could exceed those levels should there be unexpected “black swan” events.

On Tuesday, spot gold edged up 0.5% to $1,851.56 an ounce at 10:14 a.m. in New York. The Bloomberg Dollar Spot Index added 0.2%. Silver spot prices inched higher, while platinum and palladium declined.