Will Gold Rally to $1,500 per Ounce?

Posted Sep 1st 2010 10:40AM by Connie Madon
Filed under: Analyst Reports, Forecasts, Market Matters, Commodities, Recession

gold Will gold rally to $1,500 per ounce? According to leading analysts, the answer is yes. Bloomberg News surveyed 29 analysts and their median number was $1,500 per ounce.

Dan Brebner of Deustche Bank (DB) was the most accurate forecaster this year. His prediction is also for $1,500 per ounce.

There are several factors driving the price of gold. Among them are:

We live in uncertain economic times. Investors are buying gold to protect their portfolios against losses in equities.
Demand for physical gold has been growing for the past 10 years.
Investment demand of 1,901 tons exceeds jewelry consumption of 1,759 tons.
The most widely held gold option is the December $1,500
The World Gold Council estimates that ETP holdings are twice Switzerland's gold reserves.

The trend clearly is for higher prices. The one snag could be a prolonged downturn in the economy. It could be that investors would need to sell some gold to cover losses in other investments.

Investors are more willing to buy gold now than in the past. Instead of buying bullion or futures they can buy the SPDR Gold Trust of gold stocks.

Would you buy gold now?

Tags: DB, featured, gold prices, inthenews

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Reader Comments (Page 1 of 1)

9-01-2010 @ 1:54PM

Sheldon L said...

Here is some food for thought...

The biggest reason that gold could move down in price is that retail investors have been crowding into it for a few years and retail investor interest has historically indicated the top of a market.