Gold's long-term bull trend remains intact despite market volatility

Polleit, an honorary professor at the University of Bayreuth, suggests that investors should focus on a five-year horizon rather than attempting to time the market bottom. He notes that while gold might test the $3,900 level, the fundamental drivers—negative real interest rates, unchecked government debt, and persistent fiscal deficits—provide a solid foundation for the metal's future appreciation.

Central banks face a trap of fiscal dominance, where the need to finance massive state debt prevents them from maintaining high real interest rates for long. Polleit argues that current inflationary pressures are driven largely by energy costs, a factor that traditional rate hikes are ill-equipped to resolve. Because aggressive monetary tightening risks triggering a recession without cooling energy prices, he believes the structural case for gold as a store of value is stronger today than it was several years ago. Consequently, he views current price levels as an attractive entry point for long-term positions.