Friday, October 17, 2008
Gold prices might have fallen markedly in response to a global equity market recovery and lagging crude oil prices, but an analyst has claimed the long-term outlook for investing in gold is still positive.
In an interview with Reuters, Joe Conway, chief executive officer of Iamgold Corporation, expressed his opinion that gold’s decline is merely temporary and that people would continue to see the commodity as a safe haven from the global economic turmoil.
As such, he predicts the price of gold will rise to breach the US$1,000 barrier before the year is out.
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“What we’re seeing now is massive financial market turmoil and, I would think, significant monetary inflation,” he told the news provider.
“As a store of value, you’re going to see more people rush to gold.”
Should gold increase in price, as Mr Conway suggests, and reach $1,000 an ounce it would be in touching distance of the London record high set on March 17th when gold traded at US$1,032.70 an ounce.
Since then, however, the gold price has declined by 24 per cent – leaving significant room for improvement in the coming months.
According to VM Group’s Matthew Turner, gold has also fallen recently due to the strengthening of the dollar.
This article was posted: Friday, October 17, 2008 at 12:25 pm