The price of gold is likely to “challenge $1,800/oz before year-end,” according to metals consultancy firm GFMS.
In an update to its April 2012 Gold Survey, GFMS attributed its bullish outlook on the yellow metal in large part to rising investment demand and the likelihood of further monetary easing in the U.S. and Europe.
Philip Klapwijk, global head of metals analytics at GFMS – a unit of Thomson Reuters – commented that “I think we’re on pretty safe ground saying that we’ve already seen the lows for the year and that firmer prices, particularly towards year-end, are on the cards.”
“We’ve recently seen how gold can react sharply to any prospect of more QE in the United States and we’re fairly confident that some form of easing is more likely than not in the end,” Klapwijk added. “We have seen periodic items of good news on the US economy but that invariably seems followed by bad. This is all before a probable slowdown in both European and Chinese economic growth. Neither can ignore its domestic problem of the fiscal cliff, with all the uncertainty and recessionary potential bound up in that.”
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