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Monday, June 20, 2011

GFMS sees gold at $1,620 in Q4

Gold should rise to around USD 1,620 an ounce and silver about USD 50 an ounce in the fourth quarter, metals consultancy GFMS research director Neil Meader said on Tuesday.
The rise is being driven in part by low interest rates, fears of inflation, Indian and Chinese demand and worries about sovereign debt, he told Reuters on the sidelines of a business conference.

"After the summer lull we should start to see a firming in the price of gold and silver," Meader said.
"The two (metals) should broadly follow one another," with volatile silver prices "nudging USD 50," he said.
GFMS had foreseen gold prices averaging USD 1,455 this year, with a range of USD 1,319 to USD 1,620, when it released its widely anticipated industry report in April.

Spot gold was bid at USD 1,519.60 an ounce at 1010 GMT compared with USD 1,514.73 late in New York on Monday. Silver was at USD 35.02 from USD 34.69.

Demand is expected to rise in China this year despite a seasonally related dip in the second quarter, Meader said. Meader also foresaw "modest net purchases" by central banks as they diversify investment portfolios.
Marcus Grubb, managing director of investment at the World Gold Council, told Reuters at the conference that global gold demand was expected to remain strong in the second quarter, supported by Chinese and Indian demand.

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