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Monetary easing may push up gold price
By Hu Xiaocen |
September 5, 2012, Wednesday
|
Print Edition
Print Edition
GOLD price is expected to surpass US$1,800 per ounce before the year's end as monetary easing in both developed and emerging markets will lift investor sentiment, Thomson Reuters GFMS said in a survey published yesterday.
The report said the bullion price will have a bumpy ride before clearing the US$1,800 mark within the year on more easing in monetary and fiscal policies by the US and Chinese governments, which will undermine their currency value and extend the period of low interest rates.
As a result total investment demand for the precious metal will likely reach a record high in both tonnage and value in the second half of this year. However, it's unlikely that the price will surpass the high of over US$1,900 per ounce reached last year, the consultancy said in the report.
"We've already seen the lows for the year and so firmer prices, particularly towards the year-end, are on the cards. Any intensification of the eurozone crisis or dashing of hopes for further easing by the US and you could easily see the rally derailed for a while," Philip Klapwijk, global head of metals analytics at the consultancy, said in the report yesterday.
Jewelers in Shanghai hiked the price of gold jewelry last Saturday by 10 yuan (US$1.6) per gram due to the recent pick-up in the bullion price. Pure gold jewelry was sold at 420 yuan per gram, excluding processing fee, at major local retailers on Monday.
The report said the bullion price will have a bumpy ride before clearing the US$1,800 mark within the year on more easing in monetary and fiscal policies by the US and Chinese governments, which will undermine their currency value and extend the period of low interest rates.
As a result total investment demand for the precious metal will likely reach a record high in both tonnage and value in the second half of this year. However, it's unlikely that the price will surpass the high of over US$1,900 per ounce reached last year, the consultancy said in the report.
"We've already seen the lows for the year and so firmer prices, particularly towards the year-end, are on the cards. Any intensification of the eurozone crisis or dashing of hopes for further easing by the US and you could easily see the rally derailed for a while," Philip Klapwijk, global head of metals analytics at the consultancy, said in the report yesterday.
Jewelers in Shanghai hiked the price of gold jewelry last Saturday by 10 yuan (US$1.6) per gram due to the recent pick-up in the bullion price. Pure gold jewelry was sold at 420 yuan per gram, excluding processing fee, at major local retailers on Monday.
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