Tuesday, August 16, 2011
1-Year Gold Price Forecasts: JP Morgan Predicts $2,500, Bank of America Forecasts $2,000
Last week, JP Morgan forecast that gold would hit $2,500 by the end of the year.
This is not an isolated trend among the big banks.
This week, Bank of America predicted that gold wold hit $2,000 within a year:
High commodity prices have now created a terms-of-trade shock for importers, feeding into current accounts, the financial sector and, ultimately, sovereign debt.
How will these imbalances unwind? Physical gold is the ultimate collateral because it has no credit risk, so EM Central Banks have been diversifying their foreign exchange reserves into gold and other non-dollar, non-euro assets in recent quarters. Looking ahead, the deterioration in credit quality in Europe and the US coupled with an increased probability of QE3 means these pressures will continue.
As a result, we revise our 12-month gold target to $2000/oz.
This shouldn't be much of a surprise to anyone who reads this site. See this, this, this and this.
3 comments:
→ Thank you for contributing to the conversation by commenting. We try to read all of the comments (but don't always have the time).
→ If you write a long comment, please use paragraph breaks. Otherwise, no one will read it. Many people still won't read it, so shorter is usually better (but it's your choice).
→ The following types of comments will be deleted if we happen to see them:
-- Comments that criticize any class of people as a whole, especially when based on an attribute they don't have control over
-- Comments that explicitly call for violence
→ Because we do not read all of the comments, I am not responsible for any unlawful or distasteful comments.
Posts
What were these people saying ten years ago when gold was $300? I remember asking an investment representative from my bank (Royal) about gold in 2001. The response was somewhat akin to the main stream media treatment of Ron Paul lately. We think you are one crazy f*** who is barely two steps removed from Ted Kaczynski so we will put you on ignore unless you are interested in some tech stocks we are highly recommending. So now these shills are all on the gold bandwagon. Yeah riiiight, that's investment advice I can sleep easy on. Oh and just try googling 'buy gold' and see often that comes up. The last time those words were this popular the precious cratered. I do believe I smell a silver in May type event coming up real soon for the barbarous relic.
ReplyDeleteI'm surprised $2000 is target, but surprised the banks are looking for it. They must feel stimulus is coming this year. I know that once $2000 breaks a flood gate could open much like silver when it passed $22... Didn't take long for it to double.
ReplyDeleteIn this situation,why American need to sell their gold in short term inspire of They know it will raise in long term meanwhile Thai people is always buying and keeping gold in the present time.Therefore What does the Market Equilibrium will be occurred or changing into ? OMG ....
ReplyDelete