The long bull run that pushed gold prices to a record high of almost $1,425 still has a ways to go, many experts say, with Goldman Sachs forecasting a peak of $1,750 in 2012.
Global debt woes will continue to push the precious metal higher, these experts agree.
"As we look toward 2012, we find it timely to reiterate our view that at current price levels gold remains a compelling trade, but not a long-term investment," Goldman analysts say in a report obtained by MarketWatch.
With the second round of quantitative easing set to end next June and Goldman forecasting "strong U.S. economic growth" over the next two years, real U.S. interest rates should start to rise in 2011, "likely causing gold prices to peak near $1,750 in 2012," they say.
Others are positive on the precious metal too. "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" Bill O'Neill, a principal at Logic Advisors and former head of commodity research at Merrill Lynch, tells MarketWatch.
He sees gold hovering around $1,500 an ounce next year.
Corrections for the precious metal will be temporary, experts say. ‘‘The trend is up,’’ Wallace Ng, executive director at ABN Amro Bank, tells Bloomberg.
‘‘Safe haven, that’s one reason, and possible inflationary pressure. Macroeconomic factors which favored gold still haven’t changed.”
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