Following another 75-basis-point hike from the Federal Reserve, gold looks to be the standout metal in the second half of the year, especially in light of lower industrial metals prices signaling deflationary forces coming back to the fore, according to Bloomberg Intelligence.
Following the Fed's July decision, gold jumped around $30, with August Comex gold futures last trading at $1,749.30, up 1.76% on the day. This comes after gold got stuck in consolidation mode following a sudden drop to the $1,700 an ounce level, which was led by a strong U.S. dollar.
"The 75-bp rate hike at the July meeting could solidify foundations for an elongated bull market in gold and U.S. Treasury bonds. Copper and gold are a bit too cold at the end of July, but we see greater industrial metal headwinds," Bloomberg Intelligence's senior commodity strategist Mike McGlone said in a report this week.
Bloomberg Intelligence sees gold as a potential standout in the second half of the year after delivering steady results in the first half of 2022. Year-to-date, gold is down 4.2%.