Amid all the negativity surrounding the housing market, the economy, and the equities market is easy to see why investors would accumulate gold.
According to Bloomberg News, investors are buying enough bullion to fill Switzerland’s vaults twice over as gold’s most-accurate forecasters say gold’s longest rally in nearly a century has further to go no matter what the economy holds.
Bberg: “Either a swift economic recovery or further dismal economic performance should bring new buyers into the market,” said Eugen Weinberg, an analyst at Commerzbank AG in Frankfurt who was the most accurate forecaster in Q1 and expects the metal to rise as high as $1,400 next year. “A stronger economy would create more jewelry demand. If the economy stays weak or gets worse, then investors will be looking for a safe haven.”
Dan Brebner, an analyst at Deutsche Bank (DB) who is the most accurate forecaster so far this year, has a higher target on the precious metal. Brebner thinks gold may rise as high as $1,550 per ounce next year.
The most widely held option on gold futures traded in New York is for $1,500 an ounce by December.
Gold futures for December delivery rose $10.00 to $1,250 an ounce Tuesday on the Comex division of the New York Mercantile Exchange, hitting a two-month high.