Positive news on the price of Gold
So, on what appears to be a downward trend for current gold prices, some of my customers and investors wonder whether the price decline will continue.
A new report from analysts at Incrementum AG in Liechtenstein says there are good reasons to be bullish on gold, which was trading today at around $1,234 (£825) an ounce.
In fact, the report, titled "In Gold We Trust 2013," set a 12-month target for gold prices at $1,480 (£973) and a long-range target at $2,230 (£1462) of which key elements are outlined below;
Negative interest rates are still predicted for the time being. Based on continuing financial woes, the report predicted the US Federal Reserve, the Bank of Japan, the Bank of England and the European Central Bank all will continue to keep interest rates at a low level. And historically there's been a very strong link between negative interest rates and gold prices.The much respected, annual "In Gold We Trust" report - included an evaluation of gold with a wide range of scenarios for U.S. and European monetary policy. Even weighing factors that could lower the price of gold, the report arrived at the long-term target of $2,230. Or approx. £1462 a troy oz. price. When this may arrive is not 100% clear
Unlike the gold market in 1979-1980, when the metal's price rose high, it's unlikely the current bullion market will end as a result of a major increase in interest rates, given the fact that governments, corporations and households are living with heavy debt. "Gold is the only liquid investment asset that neither involves a liability nor a creditor relationship," the report stated, calling gold the "only international means of payment independent of governments" and noting it has survived every war and national bankruptcy.
The gold mining industry is undergoing changes as to enhance its profitability, displaying disciplined capital deployment and stable cash flow per ounce of gold over maximizing gold production.
"We believe that the new commitment to transparent cost reporting, greater financial discipline and shareholder value is a crucial - if quite late in coming - insight by the sector," the report said.
A "bottoming process" on gold prices will soon begin, and there's likely to be "very little" momentum before August. After that, gold prices should begin to rise.
Personally speaking no one can be 100% sure of what the world economy across the globe is going to do which subsequently affects the daily price of gold. However it is good to be able to base some positive news on the outlook for gold based on a valued world source on gold prices and the world enconomy. So watch this space for more news on when the best price for your gold is likely to be, hopefully in the near future eh!
