Could gold hit $1,300 an ounce?
Experts in the field of gold are predicting a rise in 2010 with the price set to hit as high as $1,300 an ounce. Interestingly it would appear that more gold is being scrapped through jewellers, pawnbrokers and gold trading companies than is actually being mined at the moment. This perfectly illustrates the pressure on the price of gold and the lack of ready supply to the main market. So why is gold proving so popular?
As we have mentioned on a number of occasions, many investors see gold as something of a safe haven in troubled times. While you could argue that the worldwide economy is coming out of recession and we are about to enter the good times, there are still some concerns in the background regarding the strength of the recovery and the fragile nature of consumer confidence around the world. As a consequence, many investors are now looking towards the gold market in the short term as a place to store their investment funds while the worldwide economic trend continues to develop.
It will be interesting to see how far investors will chase the price of gold because ultimately when the worldwide economy does recover it is likely we will see interest in gold start to flounder which could lead to a weaker gold price.
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