Gold may rise as investors seek haven from risk of debt default
Sunday, 25 April 2010
LONDON, April 23 (Bloomberg): Gold may advance as investors seek a haven in precious metals from the possibility of debt defaults, a survey showed.
Fifteen of 20 traders, analysts and brokers surveyed by Bloomberg, or 75 per cent, said gold may rise next week. Two people expect a decline and three were neutral. Gold futures for June delivery rose 0.1 per cent this week to $1,138.30 an ounce on the Comex in New York by 11:30 a.m. local time yesterday.
The total budget shortfall for 16 countries that use the euro widened to 6.3 per cent of gross domestic product last year, from 2 per cent in 2008, the European Union's statistics office said yesterday. Gold rose 24 per cent last year as the Federal Reserve kept interest rates close to zero to revive the economy.
"The conditions that caused investors to buy and hold gold last year have not fundamentally changed, and the added risk of sovereign default only adds to the reasons to hold," said Adrian Day, chief executive officer of Annapolis, Maryland-based Adrian Day Asset Management with $132 million in assets.
Prices may vary between $1,130 and $1,170, he said. Jeff Christian, managing director at New York-based research company CPM Group, forecast a range of $1,080 to $1,160.
Fifteen of 20 traders, analysts and brokers surveyed by Bloomberg, or 75 per cent, said gold may rise next week. Two people expect a decline and three were neutral. Gold futures for June delivery rose 0.1 per cent this week to $1,138.30 an ounce on the Comex in New York by 11:30 a.m. local time yesterday.
The total budget shortfall for 16 countries that use the euro widened to 6.3 per cent of gross domestic product last year, from 2 per cent in 2008, the European Union's statistics office said yesterday. Gold rose 24 per cent last year as the Federal Reserve kept interest rates close to zero to revive the economy.
"The conditions that caused investors to buy and hold gold last year have not fundamentally changed, and the added risk of sovereign default only adds to the reasons to hold," said Adrian Day, chief executive officer of Annapolis, Maryland-based Adrian Day Asset Management with $132 million in assets.
Prices may vary between $1,130 and $1,170, he said. Jeff Christian, managing director at New York-based research company CPM Group, forecast a range of $1,080 to $1,160.