It will not have much impact in the short term, because the United States has corresponding economic and military strength, but in the long run, if the United States can successfully transfer its domestic economic pressure to other countries, the price of gold will rise significantly.
In fact, the funds generated by the US Federal Reserve's purchase of assets will not directly enter the real economy, and a large part of the funds will still circulate in the financial system. "This part of the money may not cause serious inflation. Of course, if it causes a serious inflation crisis, it will be profitable in some cases. " Xu Quanhan, a gold analyst in the Precious Metals Business Department of China Industrial and Commercial Bank, analyzed the subsequent flow of a large amount of funds after the outbreak from an objective perspective.
The remedy of the Federal Reserve is correct, which is basically the same as that in 2008, but the scope of remedy is wider. Xu Quanhan said that the measures taken by the Federal Reserve to rescue the market have two main functions. First, prevent liquidity risk from causing financial market collapse and causing problems in financial intermediary function; The second is to provide cheap credit to the real economy by playing the role of lender of last resort to tide over short-term difficulties.
If the Fed starts to recover liquidity before strong inflation, it will be bad news for gold. But for the Fed, it is still unknown when and what kind of policies to adopt, which should be judged according to the labor market data and consumption data.
However, from another perspective, the outbreak of the COVID-19 epidemic has led to a rapid decline in the global economy, and governments and central banks have successively introduced stimulus policies. In particular, the Federal Reserve started "unlimited QE" while cutting interest rates. Once inflation occurs, it will benefit gold for a long time to come.
The sharp increase in interest rates by the Federal Reserve has curbed economic activity. The US economy slowed down slightly in the fourth quarter of last year, but it stil