John Paulson on Why Gold Will Climb

Billionaire hedge fund manager John Paulson, who has a large position in gold, is out with comments on why he thinks gold will climb near term.

Although inflation and inflation expectations remain subdued, which appears to have dampened the appetite for gold so far this year, we believe that ongoing central bank purchases and strong gold demand from China and India will help support the gold price in the near-term.[...]With ongoing, open-ended bond purchases, the Federal Reserve’s balance sheets continues to expand, and the Fed has now also confirmed that there is not going to be an unwinding of the stimulus through bond sales.This, in our view, increases the probability that money printing will eventually lead to inflation.

Paulson made the comments in a letter to his clients, which was obtained by Bloomberg.