Jan Nieuwenhuijs, a gold market analyst, has predicted that gold could surpass prices of $8,000 over the next decade as the ongoing Ukraine-Russia war and the global battle against inflation changed the preference of central banks. by foreign currencies to gold. The proposed long-term price model shows that each troy ounce of the metal could touch the $10,000 mark.
Analyst argues for $8,000 gold prices
Jan Nieuwenhuijs, a gold market researcher, has predicted that the price of gold could top $8,000 over the next decade as central banks change their reserve preferences due to macroeconomic factors and war. Nieuwenhuijs believes that the current conflict between Ukraine and Russia and the global war against inflation will cause a change in the composition of reserves.
As part of his analysis, which considers the historical percentage of gold held by central banks as a key metric, Nieuwenhuijs state:
Central banks as a whole have unusual faith in currencies, with gold’s share of total reserves accounting for 16% in 2022, up from a historical average of 59%. However, these central banks are starting to lose confidence in the currencies issued by their peers.
According to his model, if central banks accumulate 51% of their reserves in gold, the price of gold would reach $10,000 a troy ounce. However, Nieuwenhuijs clarifies that while central banks will be the ones to lead this turn towards gold, private banks and other organizations will also follow the trend.
Central banks show strong demand for gold
Central banks have been hoarding gold of late. In 2022, central banks bought a record amount of gold, with reserves increasing by 1,136 tons, while foreign exchange reserves fell by $950 billion. In the third quarter of 2022 alone, central banks bought close to 400 tons of gold, according to reports from the World Gold Council.
On March 2, the World Gold Council reported that central bank demand for gold continued to be strong in 2023, as central banks added 31 tonnes of the precious mineral in January. Turkey was the country that bought the most gold, acquiring 23 tons.
Other personalities have also warned about the rise of gold and other scarce goods, such as bitcoin. Robert Kiyosaki, author of the best-selling book Rich Dad Poor Dad, predicted in February that gold could hit $5,000 by 2025, which also indicates the possibility of Bitcoin hitting $500,000.
What do you think about the prediction of gold prices reaching $8,000 or even $10,000 in the next decade? Tell us in the comment section below.
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