Gold fever hits investors, jewelry sellers as bullion price soars
Posted July 25, 2011 1:34 pm.
This article is more than 5 years old.
Experts say consumers will be paying more for gold jewelry in the coming months as the price of the precious metal could break the milestone US$2,000 per ounce.
Gold hit a record high of US$1619 per ounce on Monday, and several experts say gold could break US$2,00 as early as next year.
As the U.S. and Europe struggle through debt crises, investors are flocking to gold, which is seen as more secure than currencies. The price of the precious metal has nearly doubled in the past three years. Back in early 2009, it was just $880 per ounce.
“There’s becoming a lack of confidence in those two major currencies, the U.S. (dollar) and euro currency,” said John Kurgan, Senior Market strategist at commodities specialist firm Lind-Waldock.
“People have been using gold as a store of value, and they’ve been diversifying out of some of those currencies into gold just as a safe haven of sorts and that’s really what’s been pressing (the price of gold) of late.”
But Craig Wright, the chief economist at Royal Bank, said the bank predicts that countries will be able to manage their debts, and foresees the price of the metal will scale back to pre-record levels.
“Going forward, our hope and our forecast is that some of the things currently scaring markets and supporting gold prices should ease and we should see lower gold prices as we move ahead,” he said in an interview.
