A bullish thesis for gold was recently presented by Deutsche Bank's commodity analysts. Gold has responded as expected to the latest round of monetary expansion by the Fed. The precious metal did not rally with Operation Twist because the program did not involve increasing the monetary base - and was therefore deemed to be less inflationary.
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| Source: DB |
If gold continues to perform (purely based on inflation fears) as it did during the previous balance sheet expansions by the Fed, DB projects gold prices hitting $1,900/oz by the end of October. Seems aggressive...
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