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$5,000 Gold Later This Decade?

July 18, 2011

goldalert

later this decadeGold bullion may reach $5,000 per ounce later this decade, bolstered by rising demand from India and China and slowing production growth, according to Standard Chartered Plc.

Yan Chen, head of metals and mining for the firm, stated that “We are looking for the gold price to reach about $2,000 by 2014,” in a Bloomberg television interview.  ”There’s a chance that the gold price can be as high as $5,000 by 2020,” as income growth in China and India fuel demand for the yellow metal.

Chen’s comments came in the wake of yet another new all-time record high for gold prices, which this morning reached $1,603.80 per ounce.  Gold has been supported of late by the ongoing sovereign debt crisis in Europe, the uncertainty over the debt ceiling in the United States, and the prospects of a third round of quantitative easing (QE3) by the Federal Reserve.

The Standard Chartered strategist went on to say that “The gold market will be in deficit in the next couple of years.  The central banks are now back buying gold massively, turning from net seller of gold into net buyer.”

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