Fidelity's Timmer Sees Gold Reaching $5,000 as Asset Tracks Global Liquidity

Gold's fair value stands at approximately $5,000 per ounce as expanding global liquidity drives prices, according to Jurrien Timmer, Director of Global Macro at Fidelity Investments. The yellow metal recently rebounded after consolidating around the $4,000 level during June and July. Timmer noted that gold shifted its trading regime in 2022 from tracking real interest rates to tracking global liquidity, with a proprietary global M2 regression model indicating the metal is significantly undervalued. Recent U.S. Treasury buybacks of long-dated bonds and increased bill issuance have also pressured the U.S. dollar, supporting bullion demand.