economy
Wall Street was once uber bullish on gold. Now it's changing its tune
The June Fed meeting set a hawkish tone. Now, several Wall Street firms don't believe gold will live up to their bullish targets.
TL;DR
- Wall Street firms are revising their gold price outlooks downward after the Federal Reserve adopted a hawkish tone.
- Higher probability of Fed rate hikes this year is expected to hinder near-term gold price increases.
- Gold's sensitivity to real interest rates makes it vulnerable to tighter monetary policy.
- Firms like Bank of America, UBS, Deutsche Bank, Morgan Stanley, and Goldman Sachs have all adjusted their gold forecasts.
- Gold prices are becoming more correlated with Fed policy expectations and less with energy prices.