Carla Gottgens | Bloomberg | Getty Images
Gold bars sit in a vault at the Perth Mint Refinery, operated by Gold Corp., in Perth, Australia, on Thursday, Aug. 9, 2018.
Gold is poised to move higher later this year, powered by the Federal Reserve’s less aggressive stance on interest rates and lingering global uncertainties, a precious metals expert said Tuesday.
Central banks have been buying gold at levels not seen in 50 years, as part of a broader diversification of reserves away from currencies including the U.S. dollar.
Concerns over the global economy and geopolitical issues including the trade war between the United States and China have added to uncertainty, which often benefits gold that’s considered a safe haven — or assets that tend to retain or increase their value even during market turbulence.
Spot gold was trading at about $1,286.646 an ounce as of 0645 GMT on Tuesday.
Gold prices have largely been stuck in a range of between $1,217 to $1,330, according to Martin Huxley, Singapore-based global head of precious metals at financial services company INTL FCStone. But he said that could change.
“I think that we expect gold to continue to trade pretty much within that range for the coming months,” Huxley told CNBC on Tuesday. “But over the second half of the year we expect it then to grind higher, and potentially it could test 1,400 towards the end of the year,” he added, referring to gold’s price per ounce in relation to the dollar.
Huxley said the
Federal Reserve’s signal that there will be no more interest rate hikes this year
has helped boost the outlook for gold and other metals.
“The view is that there won’t be any interest rate rises this year, which again will be supportive for the precious metals sector,” Huxley said.