Institution: Gold Bull Market Not Over Yet, Reversal May Be Near
BlockBeats News, June 26th, a report from CICC stated that since March, the price of gold has been continuously correcting. The international gold price once dropped below $4,000 per ounce, retracting more than 25% from the early March peak of $5,321 per ounce. This correction was mainly influenced by two factors:
The first factor is the US-Iran conflict, which pushed up oil prices and inflation. The market is concerned that US inflation is persistent, leading to expectations of monetary tightening. The second factor is the June FOMC meeting, where Powell's debut was interpreted as hawkish, intensifying concerns about monetary tightening: Powell emphasized inflation discipline, raised inflation expectations on the dot plot, and half of the 18 committee members support at least one rate hike by the end of the year.
The current market narrative believes that the focus of the Fed's policy is "inflation control." The futures market has already priced in one rate hike by the Fed in 2026 and another in 2027 to restore the US dollar's credibility, leading to a stronger dollar pressuring gold.
Regarding the two scenarios mentioned above, we believe that linear extrapolation is not appropriate: US inflation may have already peaked, and the second half of the year may see a downward trend. Powell's debut does not necessarily mean that the Fed has completely shifted to tightening. The current stance may be to leave room for future policy to return to easing. Therefore, this round of gold correction does not mark the end of the bull market, and a turning point may be imminent. We remain optimistic about the future of gold and recommend holding positions, buying on dips, and patiently waiting for a turnaround. (FX678)
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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