Business Articles - Gold Price Update


by NEIL DENNIS - Date: 2009-10-19 - Word Count: 267 Share This!

Gold is selling close to $1,000 (£632) an ounce – up more than 20% over a year. Just five years ago, it was selling for just $400 (£253).

Concerns that inflation could rise are at the heart of the gold boom. While inflation will eat away at the spending power of currency, gold bullion tends to hold its value.

James Steel, precious metals analyst at HSBC, said gold's ability to rebound over the $1,000 level was impressive as previous rallies beyond this level had been followed by significant price corrections.

"The deterioration in the outlook for the US dollar combined with an improvement in investor risk appetite is propelling gold prices higher" said Mr Steel. "Gold appears poised to challenge its record highs of $1030.80 an ounce."

The highest level ever reached by the yellow metal was $1,030 per ounce, which it attained in March 2008, and it is currently trading at just under $1,000 per ounce.

Now the largest bank in Germany has announced that it is increasing its previous price estimate by over 30 percent in predicting that gold will surpass $1,100 per ounce in 2010.

‘It’s likely to be third time lucky for gold: the price has tested the $1,000 mark twice – in March 2008 and in February this year,’ says Bill O’Neill, portfolio strategist at Merrill Lynch Global Wealth Management.

‘If there is even a hint that central banks are being over-generous in their fiscal stimuli, gold will become everyone’s touchstone. Investors worried about the quality of the currency or government bonds they are holding will seek the reassurance of gold.’


Related Tags: investing in gold, gold investment, gold trading, gold bullion, buying gold, trading gold, gold bars, selling gold, trading desk

Your Article Search Directory : Find in Articles

© The article above is copyrighted by it's author. You're allowed to distribute this work according to the Creative Commons Attribution-NoDerivs license.
 

Recent articles in this category:



Most viewed articles in this category: