Bank of Taiwan's Yang: Gold Price Below $4,500/oz a Relative Low for Long-Term Investment

(CNA, Taipei, 20th, by reporter Lu Yen-tzu) With international gold prices fluctuating at high levels, Yang Tien-li, Manager of Bank of Taiwan's Precious Metals Department, stated today that while forecasts from foreign institutions on gold prices are divided, with some revising down their target price, Bank of Taiwan believes that in the long run, any price below $4,500 per ounce is a relatively low point, and advises investors to build positions using a dollar-cost averaging method. Speaking to the media after attending a Bank of Taiwan anniversary event this afternoon, Yang said that market expectations for the direction of the U.S. Federal Reserve's interest rate hikes remain the primary factor influencing gold prices. The market is currently focused on several key variables, including when the U.S.-Iran war will end, the trajectory of U.S. inflation and interest rate hikes, and whether safe-haven funds will flow back. Yang observed that recently, forecasts for gold prices from various foreign institutions have diverged. Some have started to lower their gold target price to around $5,000 per ounce, but most major investment banks still maintain long-term target prices ranging from $5,400 to over $6,000 per ounce. Regarding Bank of Taiwan's outlook on gold prices, Yang said that based on the current situation, as long as the price falls below $4,500 per ounce, it is considered a relatively low level in the long term, with relatively small risks. For the general public, he recommended a 'daily deduction' dollar-cost averaging approach, which is more stable. Additionally, Bank of Taiwan regularly releases its 'Gold Piggy Bank Deviation Rate' value for investors' reference. Yang explained that this is an indicator designed for investors with a long-term holding objective and is less suitable for short-term trading. Based on past experience, if the deviation rate exceeds 20%, it indicates that the gold price is entering an 'overbought zone,' and one might consider reducing positions or pausing contributions. If the deviation rate drops to 5% or even turns negative, it signifies that the gold price has entered a relatively low point, marking a good time for long-term investment.