BNP Backs Gold to Hit $6,000 an Ounce as Rally ‘Makes Sense’

Core Viewpoint - Gold is projected to reach $6,000 an ounce by the end of the year, driven by ongoing macroeconomic and geopolitical risks, with a rising gold-silver ratio indicating a preference for gold over silver for risk protection [1]. Group 1: Gold Market Insights - BNP Paribas's David Wilson highlights that the gold-silver ratio has rebounded, although it remains below its two-year average in the 80s [1]. - Continued central bank purchases, such as Poland's recent announcement to buy an additional 150 tons of gold, support the positive outlook for gold [1]. - Steady inflows into gold ETFs have been observed, with only a minor drop during a recent market correction [1]. Group 2: Silver Market Dynamics - Silver has experienced significant volatility recently, primarily due to strong physical buying in Asia [3]. - The physical silver market is showing signs of softening as supplies are moving into Europe and Asia [3]. - Anticipation of the Lunar New Year holiday is expected to further reduce demand for silver in China [3]. Group 3: Institutional Support - Major banks and asset managers, including Deutsche Bank and Goldman Sachs, support the recovery of bullion due to long-term demand factors [2]. - The Chinese central bank has extended its gold buying streak to 15 consecutive months, indicating robust official demand [2].