Jefferies Investment Bank has released a review of the precious metals market. Gold is currently trading near the four thousand dollar mark. This is reported in the report of the company's analysts. Experts consider interest rates to be the main influencing factor. It is the value of money that determines the demand for metal. Gold and real bets move synchronously. This is confirmed by the bank's internal calculations. The metal often weakens as bond yields rise. Investors choose fixed-profit instruments. Market expectations have changed dramatically since the beginning of the year. Previously, the participants expected a reduction in the cost of loans. Now the forecasts have shifted towards tightening. This led to an adjustment in the quotations of raw materials. The price has dropped by twenty-five percent from its peak. Demand from central banks has also weakened slightly. This happened in the first quarter of this year.

Analysts have studied historical periods of rising rates. They compared the situation with previous cycles. In 2013, the market experienced a period of turbulence. Then gold fell by almost twenty-three percent. Shares of mining companies declined even more. A similar pattern was observed in 2018. Then the drop was about five percent. The tightening cycle of 2022 also showed a decline. Gold has lost almost seven percent of its value. However, the results on the horizon of the year were different. The behavior of regulators played a key role. If the rate pressure eased, then assets grew. Miner stocks showed different recovery dynamics. In 2018, they went up sharply. After 2022, growth was moderate. Analysts emphasize the importance of the real bets factor.

The current yield on Treasury bonds remains high. The real rate on ten-year securities exceeds two percent. Inflation expectations are at the level of the previous months. Exchange-traded funds for gold showed a decline. The GLD fund fell by thirteen percent. The GDX fund lost seventeen percent of its value. However, experts see important support factors. The rates have stopped being a shock to the market. Gold has a stronger base than before. This is facilitated by central bank purchases. The data for the second quarter confirms this trend. De-dollarization processes and budgetary issues also have an impact. Countries are diversifying reserves in favor of physical assets. The situation in the betting markets remains tough. The probability of an increase will remain until 2027. Geopolitical factors can change this picture.

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The material has been prepared solely for informational purposes and does not constitute financial advice or recommendation.