US Bank Wealth Management does not expect gold to consolidate above $3,000

Kitco News reports that the gold market is experiencing moderate profit taking after the prices exceeded $3,050. Senior strategist at US Bank Wealth Management Rob Haworth warns that, despite the likelihood of reaching new highs, further asset growth requires increased uncertainty. 

Haworth believes that the gold market has already priced in the prospects of a slowdown in the global GDP growth and a weaker US dollar. Significant acceleration of inflation or the onset of stagflation in the US may contribute to further rise in the gold prices after the economic uncertainty has leveled out. US Bank Wealth Management forecasts the US consumer price index in the range of 3–3.5%, which is not favorable for the asset, according to Haworth.

Besides, the gold prices may consolidate above the current levels if global interest rates approach zero. However, the expert highlights that this situation is unlikely. While the European Central Bank and Bank of Canada are easing their monetary policy, other major regulators have taken a more neutral stance.