Gold Market Commentary: Gold winded in February by strong US data

The World Gold Council just published their Gold Market Commentary, reviewing the down-dip gold performance in February, and providing analysis and insights into the year ahead.


February in review:

  • Gold shed 5.2% in February, as surprisingly strong US economic data propelled both yields and the US dollar higher
  • Global gold ETFs suffered more losses led by European funds while North American funds saw small outflows for the first time in two months. Recent futures positioning remains unavailable following issues with the data.

Looking forward:

  • Strong data in February reversed the four-month trends of most assets including gold
  • While a bout of economic strength can’t be dismissed, arguments that it was an exception and the US economy is on course for a more material slowdown are convincing
  • This should reinforce a solid case for gold for the remainder of 2023, as laid out in our Outlook.

“We maintain that the central scenario in our 2023 outlook is still  valid with a bias towards downside risk. Should data turn recessionary again, history suggests gold will benefit. With real bond yields still relatively low, equities on shaky ground and gold having retraced 30% of its September rally, the gold case is good and reward to risk is rising.”