Gold Futures Set to Soar Above $4600 on US Debt Worries
Gold futures on Bursa Malaysia Derivatives are expected to rise above US$4,600 per troy ounce this week, according to Quintex Intel's global strategist Stephen Innes.
Innes attributes the potential increase in gold prices to growing concerns over US national debt and the credibility of its fiscal policies. With the media reporting that US debt has surpassed US$40 trillion for the first time, investors are seeking protection by buying gold as a hedge against inflation and economic uncertainty.
Bullion is seen as a safe haven asset that can help protect against excessive government debt and potential financial repression or renewed balance-sheet support. Innes notes that in this environment, gold remains one of the best hedges against a broader erosion of fiscal credibility across developed markets.