Gold extended its rally Monday, nearing $3,800 an ounce as robust demand and ongoing economic uncertainty strengthened its safe-haven appeal.
Despite the near-record highs, a key survey of institutional investors indicates that a speculative frenzy has not yet taken hold, suggesting the rally could have more room to run.
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Nowhere Close To The Golden Fever
This cautious sentiment is highlighted by data from a recent Bank of America Global Fund Manager Survey, which shows that 39% of fund managers still have zero allocation to the precious metal in their portfolios.
While this figure is down from 47% in August, it points to significant untapped investment potential. Ryan Detrick, the chief market strategist at Carson Research, commented on the findings, stating, “This is simply amazing, but it also shows we aren’t anywhere close to gold fever yet.”
Central Banks Holding More Gold Than US Treasuries; China Leads
The rally is instead being underpinned by robust physical demand from key markets and a flight to safety. China, the world’s largest gold consumer, saw its non-monetary gold imports surge to 104 tonnes in July, well above the five-year average.
Meanwhile, demand in India is anticipated to pick up with the start of the festival season. “With the auspicious beginning of Navratri starting today, domestic markets may hope to see some buying traction,” said Darshan Desai, CEO of Aspect Bullion & Refinery.
He added that …