According to experts, many macro factors are supporting the growth momentum of gold prices. However, this is not the only investment channel that benefits from the new market context.
“Gold is still a potential investment channel. This asset class can cope with the risks that may occur in the coming time, especially when major economies continue to show signs of slowing down due to reduced consumer spending and rising unemployment rates,” said Trinh Ha, market strategist at Exness Investment Bank, at the seminar “Finding investment opportunities in the second half of the year” organized by Dau Tu Newspaper.
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| Mr. Trinh Ha believes in the growth "performance" of gold in the second half of this year. Photo: Investment Newspaper |
Not only that, gold promises to remain “hot” due to the continuous purchase of major central banks. In a report published by the World Gold Council (WGC) in June 2024, up to 29% of 69 central banks surveyed intended to increase their gold reserves in the next 12 months. This is a record high rate since the WGC began surveying in 2018.
In addition, the BRICS bloc also has a major “taste” for gold. According to the WGC, this organization has been the largest buyer of gold since 2022, and China is currently the member country with the most active gold reserve purchase activity.
“In addition, the trend of interest rate cuts by major central banks will cause the USD to depreciate. This will open up favorable opportunities for gold investment,” Mr. Trinh Ha added. Currently, financial institutions are forecasting that the US Federal Reserve (Fed) will lower interest rates 2-3 times this year. Europe and the UK will also have similar moves towards the end of the year.
In addition to investing in gold, the expert from Exness Investment Bank said that investors can also refer to the cryptocurrency market. This investment channel also has some similar characteristics to gold, such as limited and decreasing supply. In the future, this will be a potential field, because some large markets such as the US, Canada, and Australia have allowed cryptocurrency trading.
“If major economies succeed in a ‘soft landing’, capital flows will seek higher-risk investment assets. For example, in the stock market, investors can choose stocks of companies operating in highly cyclical sectors and using high operating leverage. Because when revenue increases, companies with high leverage will have rapidly increasing profits. The same is true for small-cap stocks,” Trinh Ha suggested.
Not only that, he also commented that currently short-term interest rates are at a good level, and cash flows are still flowing into short-term bonds to enjoy high yields. However, when the Fed decides to lower interest rates, the market will shift to bonds with safer yields and higher yields than current government bond interest rates.
Source: https://baodautu.vn/vang-lieu-con-la-kenh-dau-tu-hap-dan-d221143.html
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