Gold and silver prices declined this week as investors anticipated the Fed’s policy decision after the latest CPI inflation report. However, prices rose marginally today, and analysts expect gold prices to rise to $1,900 per ounce in 2022. Furthermore, rising inflation could make holding precious metals more attractive than holding U.S. dollars. Hence, the SPDR Gold (GLD), VanEck Vectors Gold Miners (GDX), iShares Silver (SLV), and Global X Silver Miners (SIL) ETFs might be reasonable bets now. Read on.Precious metals have long been reliable investments in the face of rising prices for consumer goods. However, gold and silver prices have declined this week as the investors anticipated the Fed’s policy decision in response to the latest inflation report. But despite seemingly heading for a fourth straight decline this week, spot gold prices rose 0.1% to $1,776.23 per ounce, while spot silver prices gained 0.2% to $21.97 an ounce on December 10.
Analysts at the investment banking firm Société Générale S.A (SCGLY (OTC:SCGLY)) expect gold prices to trade at around $1,900 per ounce by the second quarter of 2022 because they do not anticipate interest rate hikes before then despite the Fed’s hawkish stance. In addition, inflation has accelerated at its fastest pace since June 1982, with the Consumer Price Index (CPI) rising 6.8% year-over-year for November, which could make precious metals a better store of value than the greenback.
Hence, we think it may be reasonable now to invest in the gold and silver ETFs of SPDR Gold Shares (NYSE:GLD), VanEck Vectors Gold Miners ETF (NYSE:GDX), iShares Silver Trust (NYSE:SLV), and Global X Silver Miners ETF (SIL) as a hedge against the rising inflation.