The World Gold Council presents the 2022 Gold Outlook report. Gold may face similar dynamics in 2022 to those of last year, as competing forces support and curtail its performance. Near term, the gold price will likely react to real rates in response to the speed at which global central banks tighten monetary policy and their effectiveness in controlling inflation.
- while rate hikes can create headwinds for gold, history shows their effect may be limited (p.2)
- at the same time, elevated inflation and market pullbacks will likely sustain demand for gold as a hedge (pp.3–4)
- jewellery and central bank gold demand may provide additional longer-term support (p.5).
As we enter 2022, the US Federal Reserve is signalling a more hawkish stance. Its projections indicate that the Fed expects to hike approximately three times this year at a quicker pace than previously expected, while aiming to reduce the size of its balance sheet.