Gold prices may be off from highs seen earlier in 2011 but get ready for
a rebound because gold is set to soar again and may break records in
2012, analysts say.
Gold prices broke records in 2011, shooting to over $1,900 an ounce in September although they have fallen by about 16 percent more recently.
As the prognosis for U.S. recovery looks better, the outlook for Europe looks worse.
That scenario allowed the dollar to resume its status as a safe haven asset that it lost amid economic uncertainty, which sent investors running to the yellow metal on fears the dollar was getting too weak.
While Europe looks increasingly worse, investors will still run to dollars early in 2012, but watch out for gold bugs jumping back in later in the year, when inflationary pressures rise in the U.S. as a side effect of loose monetary policies over the last couple of years.
"Although investors are currently not focused on an inflationary
environment, longer term we believe with the amount of stimulus injected
globally and higher inflation expectations will continue to support
investment demand in gold," says Tanya Jakusconek, an analyst for the
unit of Canada's Scotiabank Group, the Christian Science Monitor
reports.
Others agree that as long as bad news seeps in from Europe and while the U.S. recovers amid a sea of inflation-fueling liquidity, gold will rise again even if at a more modest pace.
"The gold price is primarily supported by investment demand. Investors look to gold as a safe haven and the limited supply of the metal could push prices to very high levels in 2012, potentially exceeding $2,000 in the next six months," says Angelos Damaskos, the chief executive of Sector Investment Managers and an adviser to the Junior Gold Fund, according to the Telegraph.
© Moneynews. All rights reserved.
Read more: Analysts: Gold Prices Poised to Set Record Highs in 2012
Important: Can you afford to Retire? Shocking Poll Results
Gold prices broke records in 2011, shooting to over $1,900 an ounce in September although they have fallen by about 16 percent more recently.
As the prognosis for U.S. recovery looks better, the outlook for Europe looks worse.
That scenario allowed the dollar to resume its status as a safe haven asset that it lost amid economic uncertainty, which sent investors running to the yellow metal on fears the dollar was getting too weak.
While Europe looks increasingly worse, investors will still run to dollars early in 2012, but watch out for gold bugs jumping back in later in the year, when inflationary pressures rise in the U.S. as a side effect of loose monetary policies over the last couple of years.
 |
Others agree that as long as bad news seeps in from Europe and while the U.S. recovers amid a sea of inflation-fueling liquidity, gold will rise again even if at a more modest pace.
"The gold price is primarily supported by investment demand. Investors look to gold as a safe haven and the limited supply of the metal could push prices to very high levels in 2012, potentially exceeding $2,000 in the next six months," says Angelos Damaskos, the chief executive of Sector Investment Managers and an adviser to the Junior Gold Fund, according to the Telegraph.
© Moneynews. All rights reserved.
Read more: Analysts: Gold Prices Poised to Set Record Highs in 2012
Important: Can you afford to Retire? Shocking Poll Results
No comments:
Post a Comment