Gold industry analysts expect price boost from currency war fears

24 August 2015 03:04 am - 0 - {{hitsCtrl.values.hits}}

A A A

REUTERS: Gold prices could rise above US $ 1,200 an ounce in the next few months as fears of a currency war following the devaluation of the yuan make equity markets choppy, boosting physical Gold and ETF buying, leading industry analysts said at a conference.

The metal has already rebounded about 8 percent from July’s 5-1/2 year low, boosted by minutes of the Fed’s last policy meeting that dented expectations for an imminent rise in U.S. rates. Spot prices hit a peak of US $ 1,168.40 on Friday.

“After the devaluation of the Chinese currency, people are worried,” said Rajan Venkatesh, head of India bullion at ScotiaMocatta, part of Canada’s Bank of Nova Scotia. “They are afraid of a currency war. They are going back to gold.”

Prices could rise to US $ 1,230 to US $ 1,240 within a month, he said on the sidelines of the International Gold Convention in the city of Panaji in western Goa state. Michael Mesaric, Chief Executive of the world’s biggest gold refiner, Valcambi, said deposits in gold-backed exchange-traded funds are hovering near their lowest levels since 2008 but current prices will attract new buying. He expects gold prices to rise to US $ 1,350 by mid-2016.

The recent bounce notwithstanding, gold has been under heavy pressure this year from expectations the Fed would raise rates for the first time in nearly a decade, lifting the opportunity cost of holding non-yielding bullion while boosting the dollar.

But analysts like Jeffrey Rhodes, founder of Dubai-based precious metals consultancy RPMC, said: “All the bad news for gold is in the press”.

“There is room in the world for strong dollar and strong gold,” said Rhodes, expecting higher demand in countries such as India, China and Greece, where currencies are depreciating. “And strong gold is an alternative to emerging market currency.”

Order Gifts and Flowers to Sri Lanka. See Kapruka's top selling online shopping categories such as Toys, Grocery, Kids Toys, Birthday Cakes, Fruits, Chocolates, Clothing and Electronics. Also see Kapruka's unique online services such as Money Remittence,Astrology, Courier/Delivery, Medicine Delivery and over 700 top brands. Also get products from Amazon & Ebay via Kapruka Gloabal Shop into Sri Lanka

Comments - 0

Add comment
Comments will be edited (grammar, spelling and slang) and authorized at the discretion of Daily Mirror online. The website also has the right not to publish selected comments.

Gold industry analysts expect price boost from currency war fears

Comments - 0

Add comment

RECOMMENDED

‘Spike in blast fishing’ poses renewed threats to Sri Lanka’s marine ecosystems

UDA owned land in Thalawathugoda; UDA Minister Prasanna Ranatunga under the spotlight for forceful occupation of reserved land

Loss-making SMIB faces political pressure in recovering loans

Baltimore Bridge Collapse: MV Dali, SL authorities anchored in mystery?

Has Sri Lanka become a potential hub for the illegal wildlife trade?

Spotlight on Moragahakanda Development Project Moragolla villagers lose livelihoods and down to one meal a day

Ambitious Sri Lankan jobseekers ‘trafficked into Ukraine war zones’

Most Viewed in News

Former MP Palitha Thewarapperuma dies from electrocution

Complaint lodged over Piumi Hansamali's possession of Gota’s Range Rover

Ranil Wickremesinghe caravan moves on despite barking dogs

Sri Lankan among NASA’s new crew for next simulated Mars journey

Two racing drivers arrested over Fox Hill tragedy

New Visa procedure implemented

MIRROR CRICKET

Is Chamari Athapaththu Sri Lanka’s greatest cricketer ever?

Athapaththu back atop ICC Women’s ODI Batting Rankings

Chamari Athapaththu sets big goal for T20 World Cup

How does CSK get best out of Pathirana?

TODAY'S HEADLINES

No footboard riding allowed, no liability for accidents: Railways Department

Six patients claim Rs.600 million from Keheliya and others for permanent loss of sight

SLPP, UNP initiates action for forming broad alliance

Here is the way!

Pakistan lose key players for last two T20Is against New Zealand

Sri Lanka secures third spot in South Asian Kurash Championship 2024

Athapaththu back atop ICC Women’s ODI Batting Rankings

Army forms committee to probe Diyatalawa Fox Hill Supercross accident