Gold 
“Barron’s spoke with Natasha Kaneva, the head of global commodities strategy at J.P. Morgan, in early December about her outlook for oil, natural gas, and gold. An edited version of the conversation follows.
“And you’re bullish on gold, right?
Since 2017, we have made only three calls on gold. In November 2017 we said, Buy gold. In July 2020 we said, Get out of that trade. And in November 2022, we recommended buying gold again. Gold and precious metals is the only commodity sector that had a positive return in 2023. It is up about 9%; everything else is down, so that was a great call. For 2024, again, this is the only long strategic call that we’re maintaining. It is for gold and silver. The target is $2,300 an ounce for gold, and about $30 for silver.
What is behind your bullish stance?
The main price driver for gold and silver—silver just reacts to what gold does—is the 10-year [Treasury note’s] real yield. It is the nominal yield minus inflation expectations. As long as the Federal Reserve doesn’t hike interest rates next year, the bullish gold and silver call should work out. When the Fed cutting cycle starts, whether in the second half of 2024 or the first half of 2025, that’s when we expect the real 10-year yield to start declining from the current, high levels. That should boost performance for those markets.
You have some other interesting calls. What is something that could surprise investors in 2024?
It is the election cycle. There will be 77 elections. Fifty percent of the world’s population will go to the polls in 2024. Some of these elections aren’t getting much attention. We have elections in Taiwan in January, and Indian elections in April and May, which could make a difference for some of the markets.
But the U.S. election is capturing the most attention. Why is it important for the oil market? Because the U.S. election is linked to the election in Venezuela. We believe there will be a lot of volatility around those events. There will be a lot of opportunities.”
*This information is solely an excerpt of a third-party publication and is incomplete. Please subscribe to the referenced publication for the full article. This is not an offer to buy or sell precious metals. Investors should obtain advice based on their own individual circumstances and understand the risk before making any investment decision.
