Tags: RBS | Choudhry | Gold | 2 | 000 | Economic | Stagnation

RBS’ Choudhry: Gold Could Hit $2,000 Amid Economic Stagnation

By    |   Monday, 02 May 2011 08:20 AM EDT

The economy remains weak in both the United States and Europe, paving the way for continued gains by gold, says Moorad Choudhry, head of business treasury, global banking and markets, at Royal Bank of Scotland.

“Economic growth is not taking hold, and current policy is insufficient,” he writes on CNBC.com.

gold200gtyy.jpg
Gold has been on a record run
(Getty Images photo)
“Having tackled the easy part (monetary policy, central bank rates and printing money) in full, and the hard part (fiscal policy, and spending cuts) only partially, it is apparent that this is not enough.”

We have merely seen huge bank losses transferred to government balance sheets amid bailouts and aid programs, Choudhry says. “Why hasn’t that solved the problem? Because the recovery in the USA and Europe has been lackluster at best.”

He calls the economic rebound “slow and patchy.”

This problem has played itself out through a price increase in gold, which has soared to record highs above $1,540 an ounce.

“Gold price rises reflect a risk-averse ‘flight-to-quality,” and have come about mainly because of dollar weakness and worries on sovereign credit risk and inflation,” Choudhry writes.

“Given this scenario, the target price of $2000 for gold doesn’t look quite so far-fetched.”

Others are bullish on gold too. “Until monetary policy changes, you’re going to continue to see gold go up,” Michael Cuggion, who helps manage $12 billion at Permanent Portfolio Funds in San Francisco, tells Bloomberg.

© 2025 Newsmax Finance. All rights reserved.


StreetTalk
The economy remains weak in both the United States and Europe, paving the way for continued gains by gold, says Moorad Choudhry, head of business treasury, global banking and markets, at Royal Bank of Scotland. Economic growth is not taking hold, and current policy is...
RBS,Choudhry,Gold,2,000,Economic,Stagnation,us,economy
238
2011-20-02
Monday, 02 May 2011 08:20 AM
Newsmax Media, Inc.

Sign up for Newsmax’s Daily Newsletter

Receive breaking news and original analysis - sent right to your inbox.

(Optional for Local News)
Privacy: We never share your email address.
Join the Newsmax Community
Read and Post Comments
Please review Community Guidelines before posting a comment.
 
Get Newsmax Text Alerts
TOP

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