Investing Demand Sending Gold Prices To $2,000 Prior To Year End, Silver Prices To $50

Oct. 2, 2011 - PRLog -- Gold and silver have reached that soft spot in the ground, but watch for them to rise spectacularly before year end. Now is really an excellent time for you to buy gold prior to the prices rise once more. Gold prices can easily attain $2,000 an ounce by the finish of 2011 as investment need continues to propel the market higher, mentioned a London-based metals consultancy recently. Thomson Reuters GFMS mentioned in its report titled Gold Survey 2011 Update 1 that the investment development is anticipated to rise further in the second half of 2011, with investment need of all sorts forecast to attain a record of just over 1,000 metric tons. Using a common price forecast of $1,815 an ounce, which means it might equate to some worth of $60 billion, the consultancy mentioned. In the first fifty percent of 2011, the team put investment need at 624 tons, a worth of $29 billion. Visit http://silver-dollar-values.com for more lucrative silver and gold tips.

The consultancy does not anticipate the price rise to become a straight shot to $2,000, stating that prices could enter a soft patch before increasing higher. Gold prices have risen over $1,900 on two events recently, but have struggled to maintain power over that area. Philip Klapwijk, international head of metals evaluation at Thomson Reuters GFMS, mentioned the first fifty percent figure of 624 tons may seem low, but “we ought to keep in mind that early 2011 saw a wave of profit taking as the prior rally ran out of steam, and equities had been nonetheless enjoying a good bull run.”

The changes in investor attitudes towards gold arrive because the sovereign danger crisis raises. “Not only did we have the threatened contagion from peripheral to core Eurozone countries however it also crossed the Atlantic in the form of the U.S. credit rating being downgraded. And each of these had been crucial to the surge in investment witnessed lately.”

Furthermore, the consultancy cited issues over the world economic climate, continued reduced interest prices, concerns about inflation in the industrialized world, inflation in rising markets and conflicts in North Africa as well as the Middle East. These issues must inspire a “pro-gold environment,” Klapwijk mentioned. On the fundamental side, official sector purchases to over 200 tons in the first half of 2011 versus just 77 tons in all of 2010 supported prices and purchases by central banking institutions will most likely inspire traders, as well, they mentioned.

Jewellery purchases remain resilient even in the face of high prices, as purchasers in India and China snapped up gold because of potent economies, bullish price forecasts and increasing domestic inflation. The consultancy mentioned jewellery product sales in the first half of 2011 had been up 7.5% year-over-year even because the typical price rose 25%.

They note that the high prices have encouraged miners to increase production, which was up 4.9% in the first fifty percent of 2011 which development is anticipated for the next year or two. Hedging elevated somewhat, to some net contribution of twelve tons, however the team does not see indicators of the return to hefty fresh hedging activity. Also, secondary supply is restrained, falling by just over 7% because of optimism for higher prices and less available scrap to sell in some nations.

Present record highs had been pushed by broad based worldwide need with speculative interest remaining negligible. Nonetheless, the present sell off has noticed speculators in gold futures increase their holdings last week for the first time since late July. Last week, purchasers of exchange-traded funds elevated their holdings for that first time a week back since mid August. Visit http://silver-dollar-values.net for more lucrative silver and gold tips.

The sovereign financial debt crisis in the Eurozone as well as the hazards posed to the U.S. financial climate is leading to safe haven need from Europe and Asia. Very powerful demand for gold continues to become observed from Germany in present days. In the precise same time in Asia, very high inflation is leading to need for bullion. Using the decline in gold prices from last week's record high, purchasers have emerged in main Asian economies like Indonesia, Thailand and Vietnam based on information sources.

Need in Vietnam stays very high with rates being paid. Physical investing in India continues to become subdued in present days subsequent powerful need observed recently. Indian ex duty premiums had been reduced for that AM and PM London fixes yesterday. Indian traders will purchase more on this dip in order to obtain stock for that approaching festivals and weddings. India will most likely be the best customer of bullion followed by China who's catching up quickly in terms of per capita use. Wedding ceremony and festival need in India is predicted to gain tempo in generally powerful months of October and November. Go to http://www.silver-dollar-values.com for more gold and silver investing ideas and plans.

India and China stay the important basic drivers of the gold market. Inflation hedging demand in India and China is set to hold on for the foreseeable long term with official inflation in India at 9% and official inflation in China at 6.5% (most present inflation figures). India’s inflation has remained stubbornly over 9% this year in spite of the central financial institution raising interest rates eleven occasions since March 2010. Similarly, China’s federal government continues to be tightening financial policy in a bid to calm inflation. India’s gold need jumped 38% in the 2nd quarter of 2011 from exactly precisely the same period of time a year previously and China’s by 25%. Need for gold bars as well as coins leapt 78% in India and by 44% in the time period.

Gold’s bull market will carry on because the sovereign financial debt crisis in the Eurozone, financial issues in the U.S. are unresolved and inflation in Asia continues to produce demand from purchasers and central banking establishments. This week's price dips in gold prices really are a ideal time to purchase gold.

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