Uncertainty will support the gold market in the coming couple of years, says Russel Chesler, investment director of VanEck Australia.
“If it was possible to estimate the uncertainty for the future four years, it would be clear that it goes beyond all limits”, – he continued, referring to non-traditional methods of the new president’s management, and the unpredictability of his policies.
“In the past few months Trump’s actions have been in focus, while the Fed paled into insignificance.
Such risks will positively affect the gold in the future”, – he added.
Among other factors supporting the growth of “yellow metal” can be called the role of gold as a hedge against inflation and as a safe haven, taking into account the inflation expectations in the United States, Brexit, Trump’s proposed tax cuts and elections in Europe.
After Trump’s election victory in November gold weakened, but has been restored by 7% since the beginning of the year. Spot gold traded higher on Tuesday, at around $ 1 228 per ounce.
Trump will be helping gold for 5 more years
Uncertainty during the entire term of the presidency of Donald Trump will boost the gold market, reports Bloomberg referring to one of the asset managers.
“If there was a way to measure the uncertainty of the next four years, we would say that at the moment it is excessive”, – said investment director at VanEck Australia Russel Chesler.
Trump’s unpredictability is related to his “non-traditional way of government”, orders and anti-trade position. These factors affect the risks in the market, which has always been dependent on the Federal Reserve System of the USA.
“Over the last couple of months all have become obsessed with Trump, his actions, statements and messages in social networks. We believe that this will continue. These risks will be positive for the growth of gold”, – said Chesler.