Invesco: Gold Becomes Strategic Allocation Amid Rising Government Debt

Invesco's head of client solutions in Asia Pacific, Christopher Hamilton, sees gold as a strategic allocation rather than a tactical play. Investors are increasingly viewing gold this way due to rising government debt levels and fiscal worries.

Hamilton discussed the factors behind the global bond market selloff with CNBC, pointing to resilient U.S. economic growth, inflation concerns, and a re-emergence of the term premium over the last 18 months. He noted that real yields are rising substantially due to productivity increases, and that gold has simultaneously increased, reflecting these fiscal concerns.

Hamilton described gold as a 'fiscal and monetary shock absorber' and a long-term strategic asset in portfolios, acting as a proxy vote on faith in the monetary system. With government debt balances and fiscal situations in developed countries, gold is becoming more attractive as a store of value.