Gold: The Safe Place to Go

Gold finished the first quarter of 2017 up 8% for its best quarterly showing in a year, and Todd Colvin of Ambrosino Brothers says the yellow metal’s Q1 performance bodes well for the future. In a CNBC interview, Colvin said his focus on the macro picture makes him bullish on gold. “It’s not just US growth. It’s Fed policy. It’s US fiscal policy. It’s European elections,” he said.

Colvin focused in specifically on the actions of the Federal Reserve. Despite the promise of three interest rate hikes in 2017, he said market uncertainty may derail those plans. Colvin pointed out that the Fed was making similar promises in January of last year, and it never came to pass.

“I think the Fed right now is still seeing the economic and policy as glass half full without any real evidence, and they need to get those first quarter hard data numbers in. They need to get through some of these cloudy events coming up like the French elections and more FOMC meetings in order to see where policy is really going to go.”

So, the bottom line according to Colvin is uncertainty – and uncertainty is good for gold, a traditional safe haven. “Right now gold is still a safe place to go, and with equities still at all-time highs … there’s a big downside risk there that gold provides insurance against.”

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