The Federal Reserve is poised to cuts interest rates this year and history shows that has pushed up precious metal prices, according to Bernstein analyst Bob Brackett.
Traders are already moderating expectations for rate cuts, though gold has held steady so far, Brackett said.
Indeed, respondents to CNBC's recent Fed survey now anticipate the central bank will cut rates fewer times this year and start the cycle later.
"In general, the anticipation of more rate cuts often lead to a positive sentiment on gold and mining equities, while the expectation of fewer rate cuts tends to be negative," Brackett said.
"Gold in the long term is generally observed to benefit from rate cuts," the analyst said.
Persons:
Bernstein, Bob Brackett, Brackett, Bernstein's, — CNBC's Michael Bloom
Organizations:
Federal, Fed, Traders
Locations:
U.S