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New York (HedgeCo.net) – In a Sunday Times article this weekend, Bryan Collings, who manages the Investment Fund for Ingnis International Hexam Global Emerging Markets, predicted an increase in the price of precious metals of 25% over the next 18 months. He forecasts that the price of gold will rise 20% to $1,200 an ounce by 2010. Remarkably, other commentators are predicting an even more significant rise to $1,500 an ounce within the next two years.
Gold was pushed to its highest level in the last six months because investors are keen to buy gold as a hedge against inflation. Gold has always been seen as a good investment in times of economic uncertainty. With continued concerns about inflation, the gold markets show no signs of cooling unlike the currency markets which continue to fluctuate.
Jason Cozens, Managing Director of Au, the online gold exchange said, “This is consistent with our predictions for the price of gold as investors are undoubtedly keen to buy gold at the moment. We are seeing an increase in enquiries from all kinds of investors. Media reports, like the Sunday Times article, are encouraging investors and we believe that it is prudent for individuals to invest up to 40% of their total portfolio in gold”.
Similarly, the price of other precious metals has soared since the beginning of the year. Silver has also strengthened with figures from the S&P GSCI Silver index showing a gain of 46.4% since the start of 2009. Copper has risen 102% since the beginning of the year and experts are predicting that with a shortage in supply and growing demand the price will continue to go up. Uranium prices are also expected to rise with an increase in demand for the metal, which is used in the production of nuclear energy.
Reuters – The price of gold could rise as high as $1,600 an ounce as investors opt for assets with lasting value rather than volatile currencies, says one hedge fund manager who has increased his exposure to the precious metal.
“All the fundamentals are in place. If it breaks last year’s high it can go to $1,200 to $1,400 quite quickly,” Pedro de Noronha, managing partner of Noster Capital told Reuters in an interview on Tuesday.
BusinessWeek – With the price of gold racing higher over the past two months, more investors are coming around to the notion that the precious metal may be the best option to protect against a possible economic catastrophe. Among the surprise new buyers? Star hedge fund manager David Einhorn.
Gold rose steadily from its November 2008 low of $682 to close at $910.70 on Jan. 26, a five-month high. Despite selling off about $10 an ounce over the next two days, investors, it seems, have realized that much of the Federal Reserve’s plan for fighting the credit crunch and reviving the economy are also likely to bolster gold’s prospects.
Thai News Agency MCOT – Gold traders in Bangkok’s Chinatown closed their doors at their peak annual sales period for their shops during the Chinese New Year for the first time on record due to the high fluctuation of gold prices in the world market, Gold Traders Association president Jitti Tangsithipakdi said Monday.
The area’s gold shops will be closed on both Monday and Tuesday, Mr. Jitti disclosed.
The gold trade in Bangkok’s Yaowarat Road Chinatown was halted for the first time in memory during the Chinese New Year holidays when Thai Chinese normally buy gold as New Year’s presents. However, the high and erratic price of gold this year led potential customers to give their family members cash instead of gold.
Fluctuations in gold prices on the world markets caused difficulty for gold dealers as they are forced to adjust the price many times a day. The price currently has been moving in a range of as much as 400 baht per day.
