What’s Next For Gold – Bear Or Bull Market? Infographic

This infographic shows important gold price drivers from their bullish and bearish perspective. Interestingly, there are credible bullish and bearish arguments for the gold price in the short and mid term. Readers should remember that we mention the “gold price”, although the infographic talks about “gold”. Our view on “gold” remains bullish, both short and long term, because physical gold is the ultimate protection against monetary policies and chaos. Nevertheless, the gold price is subject to economic and financial parameters.

The infographic presents the bullish and bearish case for the following subjects. Courtesy: American Bullion.

1) In which way can interest rates impact the gold price?

  • Bearish: Economic improvements and low inflation will lead to long-term increases in interest rates.
  • Bullish: Negative real rates have been negative lately.

2) In which way will inflation impact the gold price?

  • Bearish: Even with QE, bank lending has not increased proportionally to the money supply.
  • Bullish: Drastic increase in the money supply is a potential catalyst for serious inflation (in the future).

3) What is the international impact the gold price?

  • Bearish: BRIC economies want a weaker currency than the US dollar.
  • Bullish: Physical buying is hitting record high levels in China and India, the two biggest gold consumers.

4) What is the short-term gold price outlook?

  • Bearish: The current trend is down.
  • Bullish: Gold could be bottoming because of seasonality.

5) What is the long-term gold price outlook?

  • Bearish: The “Gold is a commodity and not a currency” view.
  • Bullish: If real rates are below 2% people and investors will hold gold instead of cash.

gold in a bear or bull market?

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