For the last couple of weeks, it looked as if the good ol’ days might be back for gold.
It had surged back to $US1400, and there was just the right level of Syria-related angst and economic uncertainty to help it buoyed.
But Syria is less of a concern than it was two weeks ago, and there’s more chatter about synchronised global growth (US, Europe, China all moving in the right direction at the right time).
So gold is falling again.
In a few sentences, Nomura’s Tyler Broda makes the case that the gold rally is over, and that it will be an ugly 2014.
Gold’s rally in the summer has occurred into rising real yields, suggesting that there is potential for some snapback. However, in our view, gold has now made most of its move, for now. We continue to be bearish on gold for 2014. Our strategists and economists expect real interest rates to increase and market conditions to improve. Persisting gold supply and slumping central bank demand add to the less than constructive fundamental conditions.