HSBC: Gold is set to be defensive in 2023, followed by gains over the year

Gold continues to hold a defensive stance at the beginning of 2023, HSBC analysts said. So that prices for the yellow metal are expected to rise.

Further monetary tightening by the Federal Reserve (Fed) in the U.S. could have a negative impact on the value of gold in the first quarter of 2023. Experts believe the dollar will fall next year if global economic growth hits a low, and market volatility nears its peak. Thus, the fall of the currency is going to be favorable for gold.

Experts predict a high demand for gold bars and coins as concerns over rising inflation, along with growing financial risks and unfolding geopolitical environment persist. Strong demand for the yellow metal from the central bank, taking place in the third quarter of 2022, is likely to bring sustained demand from government agencies next year.