Gold prices look set to reach their climax at more than $1,000 an ounce this year, it has been claimed.
According to precious metals consultancy GFMS, investor demand for the yellow metal will help to push up prices further in 2008, with gold bullion set to be positively affected by a potential slip in US economic growth, Reuters reports.
Speaking at the Indaba African mining conference in Cape Town, Paul Walker, chief executive of GFMS, said that up to $400 billion of investor funds could be ploughed into gold if the US economy falls into recession.
He went on to add that gold is “dancing to its own tune”, rather than just being influenced by the weakening US dollar.
The comments came weeks after GFMS published its Gold Survey 2007 report, which suggested that gold prices will average at about $840 an ounce in the first half of this year.
Further increases after this are a distinct possibility, it added.
Meanwhile, a poll by Bloomberg recently found that 17 of 26 investors, traders and analysts believe investing in gold now could be a good move as a result of speculation of over whether last month’s rate cuts by the Federal Reserve will continue to keep the dollar weak.