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Gold's record rally is consistent with positioning ahead of a recession, according to reports. The 20% rally year to date coming as investors position around rate cuts, lower borrowing costs, and concerns about a potential hard landing. Here to discuss what's next for the asset. We've got Chris Mancini. He's the associate portfolio manager of the Gabely Gold Fund GoldX at Gabely Funds. Chris, it's great to have you. I do just want to start with this idea of why we're seeing gold at such record highs. I know that it's either, you know, hedging against a potential hard landing, but we've also got central bank positioning, institutional buyers, hedge funds purchasing gold at record rates. Is that an indication that smart money is concerned about a slowdown, or is it something more related to monetary policy and the wonkiness of that?

Yeah, I think it's a combination of both, like you said. I mean, I think that we are seeing an increased interest in gold as rates come down, as we are seeing the economy weaken. There's the potential that rates decline. There's an opportunity cost to holding gold, which doesn't have a yield. And so as that opportunity cost declines, we're starting to see interest. So we've seen interest in gold-backed ETFs start to grow as rates have started to decline as the economy has shown signs of weakness. But there has been this consistent kind of like solid base load demand from central banks, and that's primarily China. After Russia invaded Ukraine, and the United States and Europe confiscated Russia's foreign exchange reserves in the form of dollar US Treasuries and euro-denominated bonds. So, so China's been buying gold, other central banks have been buying gold, that's the base load, but this recent upturn has been because we've had ETFs buying gold as interest rates have declined as the economy's weakened.

So Chris, how much of a Fed rate cut has already been priced in? I guess when we're trying to figure out whether or not we're going to see some profit taking from these levels similar to what we have seen over the last several months following those record high prices for gold. Is that likely, or on the flip side, is it still going to be a catalyst?

I think it'll still be a catalyst. I mean, because what's interesting is that so far this year, we've seen around 3 million ounces come out of gold-backed ETFs. That's out of a total now, I think we're like 82 million ounces. So it's like three and a half percent or something like that of all the gold and gold backed ETFs has been sold just in, just so far this year, and we're just starting to see an uptick. And these and what we've seen in the past is that these these trends, you know, they they typically keep on going. So if rates do keep declining, so if we see like if we see one rate cut and then then that's it, then maybe, you know, maybe the rally will stop. But if rates continue to decline after this projected next one in September, I think that we'll continue to see flows into the ETFs, and that that'll drive the gold price higher.