By:- Mr. Sachin Sawrikar, Managing Partner, Artha Bharat Investment Managers IFSC LLP
Gold has fallen nearly 24% since its January peak of $5,595, and today’s Fed-driven selloff added to the pain. The reasons are inflation fears from the oil shock, a hawkish rate environment, a stronger dollar, and leveraged positions being unwound. These are cyclical pressures, not a fundamental breakdown. That said, anyone calling the bottom with confidence is guessing. What we can say is that the structural case, sovereign debt at historic highs, persistent central bank accumulation, and growing questions around reserve currency durability, hasn’t reversed. Whether this is the entry point or there’s more downside, nobody knows. But investors with a five-year horizon and no allocation to precious metals should at least be asking the question.