Jeffrey Christian, managing partner of commodities market firm CPM group, predicts gold prices will remain mostly flat for the first half of 2017 but rise sharply in the second half based on increasing global uncertainties and other factors recently discussed on FS Insider.
Christian, a recognized expert on the precious metals markets and commodities in general, has advised many of the world’s largest corporations and institutional investors. In addition, he’s lent his insights to the World Bank, United Nations, International Monetary Fund and numerous governments.
When FS Insider spoke with Christian on December 17, 2015—the very day gold made a major bottom—he accurately predicted a revival in 2016 and drew special attention to a possible “boomerang effect” as record short positions flip long, which is exactly what took place in the weeks and months following his interview. This time, he gave us some insight into how the election of Donald Trump and looming geopolitical events will impact gold prices in 2017, which you can hear below in the following clip:
“There are a number of factors in Europe and around the world that are going to be important and will probably drive investors to the security that gold affords them over the long run,” he said.
Conventional wisdom holds that the value of the dollar negatively correlates with gold. That may not hold true for the near future, though. Christian said that with the dollar and gold functioning as safe haven investments, they could rise at the same time.
“When you get into a situation where people are very concerned about preserving their wealth, they will get into a situation where they buy gold and the dollar,” he said. “We think the dollar and gold can rise together probably not in the first half of this year but later as the factors driving investment demands change and investor perception demand change.”
Christian believes that after staying flat for the first half of 2017, gold will rise sharply in the latter half of the year. While investors may be tempted to cash out after the first bump, he advised holding on to gold assets. He believes the long-term outlook for gold will reward patience.
“I think that gold prices are going to move to record levels in the next five to ten years,” he said. He added that investors who missed out in early gains shouldn’t dismiss later investments in gold.
“Don’t let the fact that you missed the first $100 keep you from investing in gold either as a short-term investor or long term at this point,” he said.
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