Gold tipped to hit US$1400 an ounce
18th August 2017
Resources Rising Stars
A top Russian investment bank has tipped gold prices to surge to a four-year high of US$1,400 an ounce by the end of the year over mounting tensions between North Korea and the US and surging consumer demand, reports Bloomberg.
The head of precious metals at VTB Capital JSC, Evgeny Ananiev, told the global newswire gold prices could rise to US$1,360 an ounce within three months before climbing higher, fuelled by global political risks and buying from China and India,
“We may see some correction, but I don’t think gold will drop below US$1,200 as it’s well supported,” he said in a weekend interview in Goa.
Gold prices are up 12 per cent this year, Bloomberg reports, driven by geopolitical concern over a potential nuclear conflict between the US and North Korea and subdued inflation in the US, which is reducing the chances of a further increase in interest rates.
President Donald Trump has intensified warnings to North Korea, promising a massive response to any strike against the US or its allies.
Hedge fund billionaire Ray Dalio has recommended that investors place 5 to 10 per cent of their assets in gold.
The bullish outlook for gold was supported by other analysts quoted by Bloomberg.
“Fundamentally, we have been very bullish on the market,” said Chirag Sheth, an analyst at Metals Focus Ltd, an independent precious-metals research firm based in London.
“What North Korea has done is given gold the legs to go above the US$1,300 level and sustain above that level,” he said in an interview.
Sheth expects prices to advance to US$1,400 in six to nine months as the situation in North Korea sees investors coming back to the market in search of a haven. The US Federal Reserve, which was hawkish on interest rates, has now softened its stance, providing further support to bullion, he said.
http://www.resourcesrisingstars.com.au/news-article/gold-tipped-hit-us1400-ounce
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