With the yellow metal having rallied sharply to hit new highs, our panel explains whether they think gold will keep its hold on investors. Giovanni Staunovo and Wayne Gordon from UBS explain why the policy and risk environment, and structural demand, are combining to point to continued medium-term upturn in the price. Plus: why geopolitical fears and election-related risks continue to justify holding gold as a portfolio hedge. See omnystudio.com/listener for privacy information.
Hello and welcome to the Bulletin with UBS on Monocle Radio.
Each week the sharpest minds and freshest thinkers in finance take you beyond the numbers and hype right to the heart of the big issues of the day.
This week we're training our lens on gold.
The yellow metal has rallied sharply to hit some 2024 high forecasts already.
We're asking our panel on this week's show to explain whether they think gold will keep its hold on invest and why the policy environment, structural demand and risk environment are combining to point to continued medium term upside in the price.
The Fed is apparently on track to begin rate cuts this month and ETF demand looks set to keep growing.
Our panel will unpack all of this and explain why geopolitics and election related risks continue to justify holding gold as a portfolio hedge.
Joining us this week we have Giovanni Stanovo, commodity analyst and Wayne Gordon Cross, asset strategist at UBS Global Wealth Management.
We spoke this past Friday 6th September.
It was a pleasure to welcome Wayne and Giovanni back to the show.
Wayne and Giovanni, let's talk about gold then.
It's been making headlines in recent weeks and days even really interesting just to get your sense, we've got prices that continue to hover around close to record highs, I think tracking pretty close to what you and your colleagues had estimated.
I think we hit the September numbers a little bit earlier.
But Wayne, let me come to you first of all, just give us a sense of what's been happening just in recent days and how much that accords with expectations or maybe surprised on the up or downside.
Just give us a bit of an overview of where we are right now.
We came into the year with a pretty positive view on gold because we did expect that there would be some cuts to US Interest rates this year and we also expected that data would start to slow down and the US Dollar would start to weaken.
And we've seen these trends really start to pick up some pace over the last few weeks.
The really great thing that we've observed over the last couple of days is that despite this significant market volatility, particularly in the technology sector, which has done very well this year, probably better than has certainly risen more than gold, but nonetheless gold has also done very well.
But the technology sector has been down pretty sharply over the last couple of days, yet gold still remains flat.
And the reason why this is really important is because we see gold as portfolio insurance or a hedge against uncertainties, whether it be of the geopolitical variety, the political variety, as we go into the US election or a pickup in market volatility.