Gold Prices Surge, but Physical Demand May Slow, Says Analyst

Gold prices continue to soar, reaching new record highs, but a slowdown in physical demand may be on the horizon, according to Commerzbank’s Commodity Analyst, Barbara Lambrecht. Despite the rally, Lambrecht cautions that the elevated prices could temper demand for physical gold.

“Interest from ETF investors has been reignited, with gold ETF holdings tracked by Bloomberg rising steadily since early August. Holdings have increased by nearly 4% since their mid-May low,” Lambrecht noted.

However, she warns that the rapid pace of the current price surge may not last. “We believe the interest rate optimism is overblown, and the high price levels are likely to weigh on physical demand for gold moving forward,” she added.

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