IMF says a relevance of holding gold
The positive link between global economic expansion and gold The IMF Global Financial Stability report, released, highlighted an increase in the level of risk among multiple global metrics. Following its publication, stocks in the US, Europe and Asia lost 4%, 3% and 4% respectively over three days. While the market has regained some of its early losses, we believe the report and the subsequent market pullback underline the relevance of holding gold in the near and long term. Last week stocks sold off, and gold acted as a key flight-to-safety asset in the market. Initially, as the US market retreated, gold held steady. But as the sell-off became more systemic globally, gold began to rally meaningfully. De facto gold has fallen by more than 11% from its April high and is currently around 7% lower y-t-d amid bearish investor sentiment. Much of this performance has been driven by a risk-on appetite in the US, where the dollar – which historically is inversely correlated