Admit it, you thought that Goldilocks is innocuous. After all, she is just a little girl who ate some porridge and laid on the bed. But she was actually an impudent burglar. Similarly, almost all people, in particular on Wall Street, like the Goldilocks economy. After all, steady GDP growth and low inflation are good, right? But not for gold!
Hence, in this edition of the Market Overview, we will analyze the link between the Goldilocks economy and the precious metals market. Although the former includes "gold" in its name, it is not supportive to the yellow metal.
We will also examine whether the US economy will remain neither too hot, nor too cold. This month is perfect for such a study, as the current expansion has just matched the 1990s boom - so far, the longest economic expansion on record in the US history. So, we will compare both periods of prosperity, to draw valuable conclusions for the gold market.
Last but not least, we will look closer at monetary statistics. The growth of US money supply is slowing down, and some analysts worry that this is a canary in a coal mine. We will, thus, examine the potential consequences of sluggish monetary growth on the economy and the gold market.