Tags: Deutsche | Bank | Lewis | Gold | Still | Cheap

Deutsche Bank's Lewis: Buy Gold Because It's Still Cheap

Friday, 17 Dec 2010 09:28 AM

Talk of gold prices climbing into bubble territory is off base because prices are attractive even at around $1,400 an ounce, says Michael Lewis, chief commodity strategist at Deutsche Bank in London.

"Current levels in gold price remain attractive and they certainly don't signal anything like a bubble," Lewis tells CNBC.

Even with gold approaching $1,400 an ounce, the market shouldn't worry over gold becoming an asset bubble until prices break $2,000 an ounce, Lewis says.

Gold prices often climb when the dollar and other major paper currencies weaken, which has been the case for a few years now.

Yet even if the greenback makes gains going forward, gold will still strengthen, as demand for the precious metal extends to investors other than those looking to hedge against weaker paper currencies, Lewis says.

"We're now in an environment where gold can go up when the dollar's rising or falling."

Any increase in interest rates on the horizon may send investors selling gold to buy fixed income, but nothing is going to happen to really break gold's overall upward trend, says Bill O'Neill, a principal at Logic Advisors in New Jersey.

"All the factors that have driven gold higher--the uncertainties, commodities as an asset class, gold as the ultimate currency — I don't see that changing significantly," O'Neill tells The Wall Street Journal.

Gold prices have risen 26 percent in 2010, staying on track for their third double-digit gain of the last four years.

© 2017 Newsmax Finance. All rights reserved.

1Like our page
2Share
StreetTalk
Talk of gold prices climbing into bubble territory is off base because prices are attractive even at around $1,400 an ounce, says Michael Lewis, chief commodity strategist at Deutsche Bank in London. Current levels in gold price remain attractive and they certainly don't...
Deutsche,Bank,Lewis,Gold,Still,Cheap
242
2010-28-17
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved