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Gold Price Dips, Goldman Sees $1,575 in 2011

Release Date: 
Thursday, December 23, 2010

GOLD PRICE NEWS – The gold price slid Wednesday morning, falling $8.50 to $1,377 per ounce.  Silver declined slightly alongside weakness in the price of gold, moving down $0.07 to $29.14 per ounce.  Strength in the U.S. Dollar Index (DXY) weighed on precious metals as the greenback gained against the euro.  Despite speculation yesterday that China was set to purchase 4-5 billion euro worth of Portuguese bonds, the European common currency was unable to mount a rally.

Today’s weakness in precious metals’ prices is pressuring the shares of companies produce gold and silver.  The Philadelphia Gold & Silver Index (XAU) slid 0.8% to 219.15 yesterday with notable decliners including Yamana Gold (AUY), Barrick Gold (ABX), Silver Standard Resources (SSRI), and Silver Wheaton (SLW).  Shares of AUY, ABX, SSRI, and SLW retreated 1.3%, 0.9%, 0.6%, and 3.2%, respectively.

The entire commodities complex has been on a tear in recent months, as investors have poured funds into investments that offer protection against the inflationary consequences of central banks’ easy monetary policies.  Oil settled above $90 per barrel for the first time since October 2008 while copper posted a new all-time of $4.29 per pound.

As the rally in commodities and precious metals picks up steam, a number of Wall Street strategists have rushed to lift their price outlooks.  The latest investment bank to do so was Goldman Sachs, which increased its copper and gold price forecasts for the next two years.  Goldman Sachs raised its average copper price forecast to $4.25 from $3.50 in 2011 and to $4.15 from $3.75 per pound in 2012.  As for the gold price, the firm increased its average estimate to $1,575 from $1,325 in 2011 and to $1,575 from $1,200 in 2012.

Article provided by GoldAlert.com.


This article is independently provided by GoldAlert.com and does not represent the views or opinions of Goldline International, Inc. Although the information in this article has been obtained from sources believed to be reliable, Goldline does not guar­antee its accuracy and such information may be incomplete or condensed. The opinions expressed are subject to change without notice.

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†This material has been prepared for private use. Although the information in this commentary has been obtained from sources believed to be reliable, Goldline does not guarantee its accuracy and such information may be incomplete or condensed. The opinions expressed are subject to change without notice.

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