Gold’s 5-year target may still be $ 5,000 as markets underestimate central bank tightening risks – Quadriga Igneo Fund – .

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Gold’s 5-year target may still be $ 5,000 as markets underestimate central bank tightening risks – Quadriga Igneo Fund – .


(Kitco News) Gold is still capable of reaching $ 3,000 to $ 5,000 an ounce over the next three to five years as markets underestimate the long-term risks associated with tightening monetary policy by the central bank after massive money printing, according to the Quadriga Igneo fund.

That forecast comes from fund manager Diego Parrilla, who successfully predicted gold’s record rise to $ 2,075.47 last year.

“Central bank printing of money doesn’t really solve the problems, it delays the problem,” Parrilla told Bloomberg. “Gold will benefit purely from being a physical asset that you cannot print. “

Money printing and ultra-loose monetary policies around the world have created many long-term problems, including asset bubbles, Parrilla said. And central banks have a tough job ahead of them when it comes to cutting and raising rates in this environment.

“The downsizing process will be freezing in terms of speed,” Parrilla said. “I think the drivers of the force of gold not only remain, but have in fact been strengthened. “

Since the new highs were set almost a year ago, gold has consolidated and is trying to come back to $ 1,900 on a sustainable basis. About a month ago, the precious metal suffered a setback when the Federal Reserve hinted at the reduction speech. At the time of writing, December Comex gold was last trading at $ 1,821.60, up 0.24% on the day.

Parrilla also noted that gold may start to rise following a risk-free event that shows central banks are not in control of the economic situation.

The $ 250 million Quadriga Igneo fund posted losses in the first half, down 22% in the first six months. Bloomberg said the fund’s long position in gold and insurance and the short position in equities were the reason for the underperformance.

Warning: The opinions expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is for informational purposes only. This is not a solicitation to trade in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no responsibility for any loss and / or damage resulting from the use of this publication.

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