For years, the financial community has debated what is the best and safest investment in times of uncertainty. For most conservative traders and investors, bonds are an obvious choice. But for the younger and tech-savvy, bitcoin is a better option. Despite current fiscal challenges and global economic trends, gold remains the best bet for Bank of America analysts.
According to Bank of America, gold remains solidregardless of the fall or even increase in interest rates. Curiously, the bank is silent on bitcoin's role in financial markets. However, many leading US banks are starting to get friendly, with Bank of America's Merrill Lynch and Wells Fargo offering bitcoin ETFs to their eligible clients.
<blockquote class="twitter-tweet”>
WOW: Bank of America Today: Gold Is 'Last Safe Haven' As Treasuries Face RISKS With US Debt
They recommend central banks and traders increase exposure twitter.com/hashtag/Gold?src=hash&ref_src=twsrc%5Etfw” rel=”nofollow noopener” target=”_blank”>#Gold twitter.com/hashtag/Silver?src=hash&ref_src=twsrc%5Etfw” rel=”nofollow noopener” target=”_blank”>#Silver twitter.com/hashtag/SilverSqueeze?src=hash&ref_src=twsrc%5Etfw” rel=”nofollow noopener” target=”_blank”>#SilverSqueeze pic.twitter.com/XIp7aAYYrx
— Make Gold Great Again (@MakeGoldGreat) twitter.com/MakeGoldGreat/status/1847034425684775351?ref_src=twsrc%5Etfw” rel=”nofollow noopener” target=”_blank”>October 17, 2024
Bank Of America: Gold is a better hedge against inflation
bank of america Analysts say gold remains a prime option in the current economic landscape. While the bank includes bitcoin and blockchain in the talks, it remains cautious. The bank adds that gold is a logical choice for investors and central banks, while gold is a better hedge against inflation and highly volatile currencies.
Furthermore, gold is considered a better investment than bitcoin” target=”_blank” rel=”noopener nofollow”>bitcoin as many expect cryptocurrencies to potentially fall, especially given the reported US PPI inflation of 1.8%, which is higher than the expected 1.6%. An increase in the PPI means that inflation will put pressure on the economy, which in turn may motivate the Federal Reserve to raise interest rates. Since economic uncertainties still exist, gold has become a reliable investment.
Gold is expected to reach the $3,000 level
Bank of America estimates that gold prices may reach the $3,000 level. This prediction is supported by the policies planned by the two US presidential candidates, Donald Trump and Kamala Harris. Both candidates support fiscal expansion, thus boosting spending.
The bank estimates that spending can grow between 7% and 8% annually by 2030 due to candidates' promises to support defense, climate and demographic policies. And if the market continues to take on more debt, greater market volatility may push more investors toward gold.
Image: Deutsche Digital Assets
Many central banks are also diversifying and increasing their reserves. Reserves have increased from 3% to 10% over the decade and demand from Western investors has increased recently. In short, Bank of America considers gold to be a better safe long-term investment.
BoFA remains cautious with Blockchain and bitcoin
Like many financial institutions, Bank of America is slowly embracing the potential of blockchain. bitcoin is being recognized as another alternative to gold as protect against inflation. Blockchain's decentralization and limited supply also make it an ideal investment vehicle.
Now that bitcoin and altcoins are gaining popularity, it is only a matter of time before major banks like Bank of America include them in their investment strategies.
Featured image from CryptoTab browser, TradingView chart
<script async src="//platform.twitter.com/widgets.js” charset=”utf-8″>
