Short September 2021 Gold Outlook

Short Gold outlook September 2021

The gold price drop in August was caused by momentum changes and interest rates.

The initial unforeseen shar early-hours selloff amid low liquidity conditions might have unnerved some investors, leading to lower investment demand despite a price recovery in 2nd half of the month.

Specific developments include a recovery in US Treasury yields after declining for each of the previous 4 months and a declaration in ETF flows from July, weighed down by outflows from North American funds.

Looking forward, while headwinds including central bank tapering may still exist for gold, some supporting factors are:

- A historically strong September bolstered by seasonal consumer demand and common investment flows,
- Persistently high inflation reports as well as elevated expectations across regions,
- Middling equity returns in emerging markets that have driven more investors to hedge portfolios.

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