CSPreciousMetals2014 March 19

Gold gets off to surprisingly strong start in 2014


The gold price climbed to a six-month high of just shy of 1,400 USD a troy ounce in
mid-March. The key role in this was played by a trend reversal in ETF sales, though the price rise was also driven in part by speculation. The gold price can thus be expected to fall temporarily again if the support afforded by the Crimean crisis falls away and real interest rates rise again on the back of better US data. Afterwards, the end of ETF selling and robust demand from Asia suggest that the upswing will continue and point to a price level of 1,400 USD a troy ounce by year’s end. Boosted by a revival of industrial demand, silver should reduce its under-valuation in relation to gold and rise to 24 USD a troy ounce.

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