‘Commodities King’ Gartman sees $1,400 gold surge in months

Gold is the one currency that will do the best of all

Pullback below $1300 is relatively inconsequential

Use gold price weakness to be a buyer no question

Bullish on gold due to central banks and easy monetary policy and gold will be even higher in euro terms

Gold willbe the best of all, as a result of QE and expansionary policies

Dalio reconfirms belief that ‘gold serves a purpose’ and portfolios should have exposure

‘Gold is a diversifying asset’ says Dalio

Own allocated, segregated gold in Zurich or Singapore

Editor Mark O’Byrne

Dennis Gartman has called2017’s gold rally and heis now forecasting gold will bedemonstrably higherrising to $1,400/oz in the coming months and rise by even more in euro terms.

In an interview onCNBC, he said that the recent correction in gold is but a mere pullback prior to much higher prices andgold is the one currency that will do the best of all.

Earlier this year Dennis Gartman, of the Gartman Letter, successfully called this year’s gold rally. In the year-to-date the precious metal is up by nearly 13%, thus outperforming the S&P 500 which is 12% higher.

A year from now, gold will be demonstrably higher than it is right nowI would certainly think we could see $1400 [an ounce] in dollar terms.

Gartman’s prediction comes a few days after another respected investor, Ray Dalio, called for gold to be held in portfolios.

Both Gartman and Dalio encourage gold investment as they believe it is an excellent diversifier and will be among the best performing currencies.

Their comments came following an intense weekboth political and economic developments, across the globe.

Signals fromcentral banks nothing to see here?

Last weekthe U.S. Fed made clear that it isstill on track to raise interest rates by the end 2017.

Gold stumbledas tighter monetary policy is seen to raise the opportunity cost of holding bullion.

This is not a cause for concern, says Gartman:

This is a correction but let’s understand the last rally that we had took off from $1200 to $1370. The fact that we’ve fallen back below $1300 I think is relatively inconsequential,

Why is Gartman so bullish on gold?

The monetary authorities are all still remaining expansionaryIn that instance, the one currency that will probably do the best of all is gold.

Gartman says this despite the announcement by the U.S. Federal Reserve and previous comments from other central banks. Clearly, he argues, balance sheet unwinding is not going to happen immediately.

[It] is going to take five or six years. This is not something that will occur overnight,

As we explainedlast weekfollowing the Fed’s announcement, the plan to hike interest rates and reduce the size of its balance sheet does not make for a happy ending.

According to 100 years’ worth of data (provided byIncrementum Capital Partners via Frank Holmes), increased rates and a reduction in the balance sheethashistorically preceded recessions.

A recession would likely kill the business cycle. Frank Holmes explains why this makes a case forholding gold in your portfolio:

Gold has historically shared a very low to negative correlation with stocks. Consider 2008, the height of the financial crisis: US stocks ended the year down more than 37 percent, while gold held its va