Macro Funds Bet Big on Gold as Rate Cut Expectations Soar

Global macro funds have already embraced gold investments due to a unique economic environment characterized by high deficits, slowing growth, persistent inflation concerns, currency devaluation, and an anticipated cycle of interest rate cuts. This trend is occurring despite market expectations for a rapid return to economic normalization and unprecedented rate cuts outside of recessionary periods. The positioning of macro funds in gold is now at historically high levels, potentially signaling a turning point in market narratives. However, with Chinese ETFs and commodity indices beginning to show outflows, there’s uncertainty about which market participants will be the first to change their stance.