With inflation and stagnation, does an ounce of gold reach $4,000?

Prepared by: Hisham Mukhaneh

Gold prices have fluctuated recently at around $1,800, but Jörg Kenner, managing director and chief investment officer at Swiss Asia Capital, sees a good opportunity for major movements in the global gold market, which may soar prices to $4,000 an ounce in 2023, as Rising interest rates and recession fears are weighing heavily on volatile markets.
Kenner explained that many economies may face a “mild recession” in the first quarter of next year, which could lead to many central banks slowing the pace of raising interest rates, making gold, the only asset that every bank owns, immediately more attractive. For investors who will be panting after the precious metal as inflation remains high in many parts of the world.
Gold is a good inflation hedge and makes a great catch and a heavy addition to a portfolio during an inflationary slump. According to the World Gold Council, central banks bought 400 tons of gold in the third quarter of 2022, nearly double the previous record of 241 tons during the same period in 2018.
Keener added, “Since the beginning of the current century, the average return on gold in any currency has been hovering around 8% and 10% annually. This has not been achieved, neither in the bond market nor in the stock market.
Despite the strong demand for gold, Kenny Polkari, chief market strategist at Slatestone Wealth, disagrees that prices could double to $4,000 next year, although he would like to see it.
Polkari argued that gold prices will see some decline and resistance at $1,900 an ounce, and that it will only be determined by how inflation responds to higher interest rates globally. He added, “I have always loved gold, and it should be part of your portfolio. I think his performance will be better, but not up to $ 4,000.