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Wednesday, August 28, 2019

Gold Glitters - Why it will be the Best Performing asset class this year

According to Deutsche Bank about 15 % of the government bonds globally trades at negative yield, many investors who shunned  gold because of its zero yield does not consider it as a penalty now. Its unthinkable that Government are getting paid to borrow money as people seek for a safe haven to park their money as trade tension and volatility rise, its no surprise that people are flocking to Gold.

Another compelling reason that make Gold a natural investment choice is central bankers around the world competes in a monetary race to bring rates to zero. Fed cuts interest rates from 2.5 to 2.25% last month and this marked the central bank's first rate cut since 2008. Recently New Zealand, Thailand and India followed in the wake of the Fed to cut rates.

As interest rates worldwide goes negative, investors suffers less opportunity cost from  gold's zero yield. Gold is traditionally  an inflation hedge and its appeal as a stored value is back again.

This blog has been predicting Gold will be the top investment asset class since 23 Mar 2019 when Gold was trading at 1310 and thus far it has hit my first target at 1550. Gold is poised to test its 2011 high of 1915 this year.

On the Chart, this is my outlook and where Gold stands now
All posts and charts are for educational and illustration purposes only

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