John Paulson predicts early stages of long-term gold price rise

Billionaire hedge fund manager John Paulson has stated that the long-term upward trend in gold prices is still in its early stages. Despite an 18% correction following a historic peak of $5,589 per ounce in January, market momentum has shifted upward again.

Paulson attributes this potential growth to declining confidence in fiat currencies and sustained high levels of government public spending. The market is also being influenced by shifting expectations regarding the U.S. Federal Reserve's interest rate policies. Weak employment data and moderate inflation in the U.S. have reduced the likelihood of rate hikes, lowering the opportunity cost of holding non-yielding assets like gold.

Additionally, continuous physical gold purchases by central banks are providing significant market support. The People's Bank of China added 19.9 tons to its reserves in July, extending its buying streak to 21 months. Goldman Sachs has also projected that central banks may purchase an average of 60 tons of gold per month through 2026 to diversify their dollar-heavy reserves.