Global markets, led largely by US equities, have been treated to a fairly robust period since the Global Financial Crisis of 2008-09. As 2019 begins, investors are beginning to think about what might happen if that next recession actually materializes, as the US has undergone what is now close to the longest ever economic expansion in the post World War Two period. Importantly, measures of volatility indicate a higher overall level of risk, relative to either the start of 2017 or the start of 2018.
In such environments, we believe that …

Gold staged a recovery late in 2018. The yellow metal has recovered most of its losses since June 2018. A collapse in speculative positioning in gold futures drove prices down in the second half of the year, sentiment toward gold is clearly recovering in recent weeks. We expect the recovery to continue as many risks that were being ignored by the market start to get priced-in to gold. Our base case scenario is for gold to reach close to US$1370/oz by year end.
Figure 1: Gold price forecast

Source: WisdomTree Model Forecasts, …

Alongside gold, silver has staged a rally late in 2018, gaining just over 10% in the month of December 2018. Silver’s close correlation with gold (around 80%) helps explain the sharp movement. As we discussed in Gold Outlook 2019, volatility in cyclical asset markets helped defensive assets like gold as investors sought refuge in a safe haven asset. We expect silver to rise to US$16.6/oz by Q3 2019, before easing to US$16.3/oz at the end of the year from US$15.7/oz at the time of writing (07/01/2019). Silver’s gain is likely …

Oil ETP inflows continue amid supply disruptions
ETF Securities Weekly Flows Analysis – Oil ETP inflows continue amid supply disruptions
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Long oil ETPs see a third consecutive week of inflows as supply disruptions extend price gains
Gold outflows continue, albeit at a reduced pace
Profit-taking appears to have driven the largest cotton ETP outflow seen since 2016

Long oil ETPs see a third consecutive week of inflows as supply disruptions extend price gains. These three weeks of inflows mark the longest period of sustained inflows since June 2017. There were US$8.6mn of inflows last week …

Gold ETPs took the lion’s share of outflows
ETF Securities Weekly Flows Analysis – Gold ETPs took the lion’s share of outflows
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Gold can’t seem to find a floor
Strong copper fundamentals appear to defy trade war threats
Falling nickel prices continue to attract bargain hunters

Gold can’t seem to find a floor. Gold ETP outflows surged last week by US$119.7mn, marking the third consecutive week of outflows as gold prices shed 0.81% last week, declining to US$1231.1. We believe the testimony of Fed Chair Powell before the US Senate had a strong role to …