World's Top Money Managers Flock Back to Gold Amid Fed Inflation Bets

Some of the world's biggest money managers have been rebuilding their gold positions after prices dropped. They are betting that long-term drivers of the precious metal will endure even as the US Federal Reserve takes a more assertive stance on inflation.

Amundi SA, Europe's largest asset manager, bought bullion on the expectation it will return to $5,000 an ounce by year-end.

Fund managers at Pictet Asset Management Ltd., Robeco Institutional Asset Management BV, and Fidelity International Ltd. also added to holdings cut earlier this year.

According to Lorenzo Portelli, head of cross-asset strategy at Amundi Investment Institute, 'Gold is an asset that we consider to be cheap, a good hedge and reasonably liquid.'

However, greater visibility over the Fed's interest-rate path would be needed before adding to last month's purchases.