Gold target $2000 in 2012 (Deutch Bank)

Gold may raise to $2,000 per ounce in 2012 – Deutsche Bank says

Deutsche Bank maintained its 2012 gold price target of $2,000 an ounce with a bias towards even higher prices, saying the precious metal would benefit from the low interest rates in the United States.

“We believe the main beneficiary of super low interest rates in the United States, a weak U.S. dollar, a view that central bank holdings in the U.S. dollar are still excessive and ongoing questions over the stability of the financial system will be gold,” the investment bank said.

Deutsche Bank said this rapid rise in gold prices may likely be accompanied by a weakening outlook for global growth and consequently result in lower oil and copper prices.

The probability of gold price trading at the $1,800 an ounce level for the foreseeable future is a high probability, even as a move lower to $1,600 an ounce is considered a more likely scenario than a rise to $2,000 an ounce, Deutsche said.

However, the bank said there remained a high probability of a bubble developing in the gold market, given the appetite to buy gold when the U.S. dollar is rising and falling, and to buy gold to hedge against inflation and deflation.

“For the time being this is not the economic scenario that we are forecasting, but, events in recent days have certainly moved us closer to this outcome,” the note said.

© Thomson Reuters 2011

Bloomberg Survey Forecasts $1,938/oz Gold in 2012

Bloomberg survey forecast

According to a survey of the four most accurate precious metal forecasters tracked by Bloomberg over the past two years, gold prices will rise to $1,713 this year and $1,938 in 2012.

Option traders are also betting big on gold rally to continue. The number one spot is captured by the speculators betting on a $2,000 by November, followed by $1,800 for the same month, data shows as of July 29.

Seems like our price forecast of $1,750 for 2011 is rather conservative for some gold market players!

The most accurate forecasters tracked by Bloomberg were Jochen Hitzfeld of UniCredit SpA in Munich; Jason Schenker of Prestige Economics LLC in Austin, Texas; Anne-Laure Tremblay of BNP Paribas SA in London; and Thorsten Proettel of Landesbank Baden-Wuerttemberg in Stuttgart, Germany.

Capital Economist Forecast: “As inflation fears mount, the price of the precious metal will be pushed to average $1,600/oz in 2011 and then reach near $2,000/oz by the end of 2012, it has been forecast, as investors clamour to buy safe haven assets.”

GO...GO....GO...GOLD......