Gold to Break Below $1,000 by Year-End

In a report issued Monday, U.K. forecasting firm Capital Economics said Gold futures will fall below $1,000 an ounce by year-end and fall as low as $800 an ounce next year.

Capital Economics’ Chief International Economist Julian Jessop attributed bullion’s recent spike to a desire for insurance against the risks of inflationary bubbles in other assets and a U.S. dollar collapse.

[MW]”These risks are probably much lower than generally supposed,” he wrote, adding his forecast depends “crucially” on at least a partial recovery for the U.S. dollar. “While we do not think that gold is yet in a bubble, the weakness of underlying demand at these record price levels is at least a warning sign,” he wrote.

Gold prices extended gains on Monday as traders bought into the metal amid continued concerns about the weakening dollar. Gold hit a record of $1,167 an ounce, up by about $15 from Friday’s closing prices.

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1 Comment on Gold to Break Below $1,000 by Year-End

  1. India bought 200 tons of gold at 1050. Do you really think they will not buy more if it goes down to 1000 again. There is also a question as to how much gold the central banks really have. We also know that any new currency will have gold as a component. But the most important part that this guy must have over looked is that governments around the world will borrow 12 Trillion USD next year. There is no such money around the globe so they will essentially just print it. Add 12 Trillion to a 45 Trillion world economy and you have at least a 20% rise in gold if not more.

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