Bank of America Merrill Lynch maintained its 12-month gold price forecast of $2,000 per ounce despite the yellow metal’s weakness in recent weeks.
In a note to clients, the firm wrote that “It is worth noting that falling quotations were not accompanied by substantial outflows from physically backed exchange traded funds particularly in recent days. Hence, the correction was not necessarily driven by a broad-based reassessment of fundamentals.”
Bank of America Merrill Lynch went on to say that ongoing “structural problems” in Europe and the U.S. were bullish for gold. Furthermore, the firm predicted that negative real interest rates will remain in place for the foreseeable future in many of the world’s developed economies.