Gold “seems to be a relatively unpopular asset right now,” explains Evie Hambro, “and this negative investor sentiment means the price is more likely to rise than it will fall in the next 2022.
The value of the precious yellow metal fell by 6% in 2021, reaching its first annual decline in three years. “Historically, during times when investor sentiment towards gold and gold miners' stocks is very negative, opportunities to buy these assets usually arise,” Hambro said.
Inflation should also play in favor of gold: "We are currently witnessing strong inflationary processes, which makes us believe that inflationary expectations will continue to rise until 2022." Real interest rates are a key factor for gold, which in turn will be driven by interest rates and inflation expectations, Hambro said.
With equity markets still near historic highs and the risk of a continuation of the pandemic still high, BlackRock sees good reason to buy gold to diversify its portfolio.