With the prospects for another round of quantitative easing in the United States increasingly strong, US real interest rates continue to fall. With 10-year TIPS yields now below 50 bps, we expect gold prices to continue to climb, and we are now raising our 12-month gold price forecast to $1,650/toz. We also recommend opening a long Dec-11 COMEX gold position.
The return to quantitative easing will likely be a strong catalyst to drive gold prices higher, and we expect the gold price rally to continue until US monetary policy begins to tighten. Our US economics team expects the US Federal Reserve to announce a return to quantitative easing measures as early as the November FOMC meeting. We see this acting as a strong catalyst to carry gold prices to the higher levels that we now forecast.
Tuesday, October 12, 2010
Goldman: We are Gold Men
Goldman Sachs is out with a gold update today:
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Ha. If this is anything like the GS "conviction buy" list it probably means we're about to have a short-term correction in the gold market.
ReplyDeleteJim Sinclair always said that jsmineset.com was read by the elites. Too bad nobody took him up on his $1M wager 2-3 years ago that $1,650 gold would be seen by January 2011.
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