Fund Managers Bet on Gold Despite Higher US Rate Fears

Several major fund managers are rebuilding their gold holdings despite growing expectations of higher US interest rates and rising Treasury yields. According to industry sources, Amundi, Europe's largest asset manager, has increased its gold holdings in anticipation that the metal will return to $5,000 per ounce by the end of the year.

Fund managers at Pictet Asset Management, Robeco Institutional Asset Management, and Fidelity International have also increased their gold positions after reducing them earlier this year during gold's retreat from its record high. Lorenzo Portelli, Head of Multi-Asset Strategy at Amundi Investment Institute, stated that gold remains an asset the firm considers cheap, offering hedging benefits and reasonable liquidity.

However, many money managers expressed concerns that breaking above the resistance level near $4,600 per ounce will not be easy due to the expected interest rate hikes. The Federal Reserve's Chairman Kevin Warsh's recent comments at the Jackson Hole symposium also reinforced market expectations of tighter monetary policy, putting additional pressure on gold prices.