Fidelity’s Jurrien Timmer sees gold fair value at $5,000

Timmer’s analysis, based on a regression between global M2 money supply and bullion, signals that gold’s trajectory is now tethered to liquidity profiles rather than interest rate fluctuations. He noted that the asset gained momentum as global liquidity began to recover, marking a clean break from the regime that dominated prior to 2022.

The strategist points to recent Treasury actions, specifically the strategy of buying back long-dated paper while issuing more Bills, as a catalyst for this shift. Timmer warns that the market is sensing a trend toward fiscal dominance, which threatens the independence of the Federal Reserve. If the Treasury requires the Fed to assist in managing yields through debt monetization, the path toward currency debasement becomes more pronounced. In this environment, loose fiscal and monetary policies act as a tailwind for both gold and Bitcoin, positioning them as primary hedges against a weakening dollar.