Inflationary concerns, volatility of risky assets to stimulate demand for gold: ICICI Securities
Growing concerns about rising inflation and expectations of high volatility in riskier assets are expected to boost demand for gold in 2022, brokerage firm ICICI Securities said.
In addition, the declining euphoria of cryptocurrencies should benefit the precious yellow metal, a traditional safe-haven asset.
“In addition, expectations of limited increases in the dollar index will help gold prices recover to Rs 55,000 in 2022,” the brokerage said.
As of Friday, physical gold was priced at Rs 48,083 per 10g, according to the India Bullion and Jewelers Association.
Additionally, rising demand for electric vehicles and declining copper inventory in warehouses will drive up its prices in 2022.
Copper prices are recovering to Rs 850 per kg, against Rs 749 currently on the Multi Commodity Exchange of India.
âIn addition, the plan of the administration of US President Biden to invest 1.7 trillion dollars in green energy is likely to push up prices,â he added.
In addition, China’s policy of reducing carbon emissions as well as the easy liquidity of the Chinese central bank should also support its prices.
On energy, the brokerage said easing travel restrictions would increase fuel demand and support lower crude oil prices.
Crude oil prices are expected to trade between $ 60 and $ 90 per barrel in 2022 against a backdrop of demand and supply balance, he added.
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