Current monetary policy is conducive to a rise in gold prices, either this year or next, said Will Rhind, CEO of GraniteShares.
"The rate hike calendar for this year wasn't going to be the same, and we obviously had the [Fed] meeting in January where it was confirmed that the Fed was going to put their policy on hold, and I think more than that, they actually kind of changed policy toward interest rates and try to engineer an overshoot in inflation rather than tightening into weakness in the global economy," Rhind told Kitco News.
According to the World Gold Council, flows into gold ETFs have declined into negative territory, the first time since September net flows were negative, but Rhind said this is not indicative of waning investor interest in gold.
"I think that what typically happens and what we saw last month was just some redemptions on the back of options selling in the market, so it's a much more tactical trade than a strategic trade. I think if you look at the longer term picture since the beginning of 2016, the trend has been very much in favor of investors getting back into the gold market and back into the ETF market," Rhind said.