BBH expects gold to rise further as confidence in US assets declines

Gold is holding above $3,300 per ounce. A slight decline in prices is driven by decreasing demand for safe-haven assets, Kitco News says. 

According to Brown Brothers Harriman (BBH), even though trade tensions have temporarily eased, Donald Trump's plans to impose 50% duties on European goods remain a serious threat to the global economy. Additionally, analysts expect announcements of higher import levies and quick retaliation from the EU. 

In this environment, BBH projects the dollar to slump. Experts highlight several drivers supporting this forecast. These include the US administration’s tariff and fiscal policies, as well as the country’s weak economic data. 

Besides, surging US debt undermines investor confidence in the Treasury bond market, BBH notes. Weak demand for bonds and, as a result, a sharp rise in yields may boost interest in gold.

Analysts project gold prices to grow further, as rising government bond yields will force the Federal Reserve to adjust the yield curve or cut interest rates.