Gold May Be Worth Much More Than You Think – Deutsche Bank | Kitco News

(Kitco News) – Gold is kicking off the week under pressure as markets continue to digest last week’s comments from Federal Reserve officials in Jackson Hole, but some analysts think investors may not be pricing the yellow metal properly.

According to Deutsche Bank analysts, there is a correlation between gold prices and level of monetary expansion by central banks, and according to this relationship, the metal should be some $400 higher.

“The balance sheets of the main four central banks [US, China, Japan and ECB] have expanded by 300% since the beginning of 2005. Over the same period as the aggregate central bank balance sheet expanded by 300%, global above-ground stocks grew by 19% in tonnage terms or c.200% in value terms,” the bank’s commodity analysts Michael Hsueh and Grant Sporre said in a report Friday.

Source: Gold May Be Worth Much More Than You Think – Deutsche Bank | Kitco News