World’s largest solid gold brick weighing 220kg (485lb)
Photo: AFP/Getty
There are both headwinds and tailwinds influencing the gold price, but the
positives combined with the degree of investment demand from wealthier
investors – should outweigh the negatives.
We believe this is likely to force a peak that is nearer $1,300 per ounce over
the next six months, with $1,000 per ounce becoming the new long-term floor.
In our view, the following factors are currently influencing the gold price
in the medium to long-term.
1. Last week’s IMF announcement of its plan to sell 191.3 tonnes of bullion on
the open market under the Central Bank Gold Agreement put pressure on gold
prices.
This negative price response seems to be due to the perceived lack of demand
from official sectors to purchase the IMF balance – last year only 150
tonnes of a planned sale of 400 tonnes was sold.
Given the publicity that surrounded the Indian central bank’s purchase of
gold, reluctance from other large central banks to take the IMF balance may
be as a result of an unwillingness to disclose their views …
Read the original article at Telegraph
