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Gold Set To Climb Over $1300? BofA Thinks So According to the Bank of America Merrill Lynch, gold is set to take a run over the next year due to the constant cloud of uncertainty with regards to the U.S budget deficit alongside concerns over trade wars. The head of global commodities and derivatives research, Francisco Blanch has stated that gold could average $1,350 an ounce of 2019 due to the U.S fiscal balance.
The tax changes are lowering the revenue base, said Blanch.
“Eventually the trade wars are going to come back to bite the U.S.,” said Blanch.
One of the world’s most successful hedge fund managers Ray Dalio has also gone on record to express his concern over the budget. Mr. Dalio has predicted that the US economy is nearly 2 years away from a downturn, which will result in the dollar plunging as the government prints money to fund the growing deficit. Goldman Sachs has also expressed their concern and has recently turned bullish on gold as they have forecasted a price target of $1,325 in 12 months. With the US budget deficit set to swell to roughly $1 trillion by fiscal 2019, it’s worth noting that the interest owed by the government is set to exponentially increase as it set to triple over the next 10 years according to the Congressional Budget Office. Whatever the case is, it’s only a matter of time before the short term trick of printing money doesn’t come back to haunt the United States economy. |
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