This week, the US Investment Bank JP Morgan updated its forecasts for precious metals. It announced its bearish mood with a forecast of gold for 2022 at a price of $1,630 per ounce, and an average of $20.48 for silver.
The report also mentioned the expectation of an increase in the long-term nominal yield of the United States, which should put pressure on gold on average.
This will not be the first time when the yield of securities interferes with the precious metal. This year, the increase in yields led to a fall in gold after optimistic comments from the central bank because there was a rebalancing of investor portfolios. Analysts have repeatedly called for higher rates this year, but with the increasing spread of Omicron strain of COVID-19, some of these calls have been called into question.
As one can see on the weekly chart below, JPM's forecast is quite far from today's price:
The current price of the yellow metal reflects uncertainty about the Fed's policy and the speed of quantitative easing and rate hikes. This week, the market will clear up, as the FOMC meeting and the announcement of monetary policy will take place today on Wednesday.