Major Gold Forecasters are Split on Peak for Bull Market

Tuesday, 15 January 2013
Written by  Bloomberg
Published in Gold Investing

It seems that two of the biggest and most accurate gold forecasters are at odds when it comes to predicting the peak for the bull market for gold. Danske Bank A/S and Credit Suisse Group AG, the most-accurate gold forecasters, say prices will probably peak this year while their nearest rival, UniCredit SpA, sees no end in sight to the 12-year bull market.

Gold will average $1,720 an ounce this year and $1,600 in 2014, said Christin Tuxen of Danske Bank in Copenhagen, who came closest to predicting moves in the past eight quarters, according to data compiled by Bloomberg. Tom Kendall at Credit Suisse in London expects $1,740 and $1,720 and Jochen Hitzfeld of UniCredit in Munich predicts $1,700 and $1,800. Bullion rose more than sixfold since the bull market began in 2001.

All three forecast record average prices this year because central-bank stimulus will sustain buying as a hedge against inflation and currency devaluation. This is the news that we just got, so these forecasters are banking on it. Danske and Credit Suisse predict lower prices in 2014 as economic growth curbs demand for the metal as a protector of wealth while UniCredit says record- low interest rates will maintain gold’s allure.

“Gold will definitely continue to rise but the euphoria has subsided,” said Donald Selkin, the New York-based chief market strategist at National Securities Corp., which manages about $3 billion of assets, including gold. “The track record is great but this year it will take a breather.”

All of the major gold forecasters, as well as many of the small ones have been updating their gold forecasts because of all the recent news that has been compiling. Between the fiscal cliff, China, the Euro zone, Bernanke announcements, monetary policy and more, gold has been all over the place and it has been much tougher for gold forecasters to make accurate predictions about what the yellow metal may do in 2013 and beyond.

With that being said, it looks like gold will continue to enjoy a nice price range in 2013, and even make a run at the long predicted $2,000 per ounce price mark. Even if it doesn’t make it to $2,000 per ounce, the yellow metal should come close to it and those who invested in the yellow metal while it was lower should enjoy some very nice returns.

Original Article: Bloomberg

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