Gold Price Forecast: XAU/USD may steady, but a rally could be a long way off – HSBC

Gold prices have come down considerably from their year-to-date highs. Strategists at HSBC expect the yellow metal to be mostly on the defensive to early 2023, before gaining ground later next year.

A pause in US rate rises in 2023 may allow gold to have a modest bounce

“The Fed is likely to continue to deliver rate hikes before taking a pause after the February 2023 meeting. If US rates keep rising until next February 2023, gold may be subject to further downward pressure. A subsequent pause in rate hikes may allow gold to rally, but a lack of rate cuts would likely limit potential gains.”

“While the financial climate has turned decisively against gold, elevated geopolitical risks, higher oil prices and general firm underlying physical demand for gold may be cushioning gold’s declines.”

“A firmer USD will help keep gold on the defensive into 2023, but limits to USD strength may offer gold an opportunity to increase later in 2023.”