How high can the gold price rise? Wall Street: Central bank interest rate cuts, dual stimulation of risk aversion sentiment, demand can reach at least $3000!

Gold price continues to surge, aiming for $3000 this time?

Driven by safe-haven demand and central bank rate cuts, the price of gold soared to a historic high on Monday, with spot gold currently at $2735.12 per ounce, up significantly by 40% over the past year and hitting new highs frequently this year.

Wall Street analysts are calling for gold to reach the $3000 mark, with Joni Teves, precious metals strategist at UBS, stating:

The outlook for gold is quite optimistic, with a target price of $3000 per ounce next year. We believe there is significant room for investors to increase their gold holdings over the next year, which should drive up the price of gold.

Michael Hartnett, Chief Investment Strategist at Bank of America, pointed out in the latest research report:

The bull market in gold is driven by policy and inflation. The 2020s will be a decade of fiscal excess in the U.S. and globally, as well as a decade of technology, trade tariffs, and protectionism.

The Federal Reserve is determined to cut real interest rates in the coming quarters. Investors only need to hedge against the threats of inflation and dollar depreciation, and gold will surpass $3000 per ounce by far.

As the world enters a loose monetary policy cycle, Hartnett remains a staunch bull on gold. Despite the boost in risk sentiment from loose monetary policies, Hartnett believes that economic prospects still hold uncertainties, and the market needs to be vigilant against inflation risks. Gold is the best hedge asset, especially against the 3D indicators: Debt, Deficit, and Debasement.

Central Bank Rate Cuts and Safe-Haven Sentiment Double Stimulus

Global central banks have started a rate-cutting cycle, coupled with uncertainties surrounding the Middle East conflict and the upcoming U.S. election results, enhancing the attractiveness of gold as a safe-haven asset.

Currently, many central banks around the world are in a loose monetary policy cycle, with countries like the Eurozone, Canada, and the UK recently cutting rates. The next meeting of the Federal Reserve is scheduled for November 6th to 7th, and the market's expectation of further rate cuts has also driven this year's rise in gold prices. Since gold does not generate any interest, its price usually benefits from interest rate cuts.

The uncertainty of the U.S. election also makes gold more attractive, as Ole Hansen, Head of Commodity Strategy at Saxo Bank, stated:

Factors driving the rise in gold prices include "financial instability risks and uncertainty surrounding the U.S. presidential election," as well as central banks reducing their dependence on the U.S. dollar.

Teves cautioned:

With the U.S. election on November 5th approaching, the outcome between Vice President Harris and former President Trump seems very close, adding to the uncertainty. There are many risks in the coming weeks, and we may experience some volatile price movements Recently, the demand for gold has been very strong, as global central banks have been diversifying their official reserves away from the US dollar, leading to strong purchases by central banks. According to the World Gold Council, central bank purchases reached a historical high of 483 tons in the first half of this year. Since the summer, Western investors have also been flocking to the gold market, with continuous inflows into gold exchange-traded funds from May to September.

Furthermore, the rise in gold prices has triggered a chain reaction causing a significant surge in silver prices, with silver prices hitting their highest point in nearly 12 years