Recent months have seen a steep rise in gold price trends mostly due to suspicion, fear and panic over the European economy, the U.S. credit downgrade and stock market volatility. As the price of gold continues to rise in this turbulent economy traders are looking for predictions as to where the price of gold will be going in 2012.
JP Morgan predicts a rising global gold price trend
JP Morgan, a leading global financial services consultant has predicted gold to surge to more than $2500 per ounce by the end of the year. Commodity analysts of the financial services company expect the gold price trend to break even more records next year. JP Morgan had initially thought the gold market trend would drop because of the U.S. credit downgrade but gold has continued to rise in price despite the effects of inflation.
Now JP Morgan has said that the gold price trend will continue on an upswing in 2012. Analysts at JP Morgan had only predicted the price of gold to average $1800 per troy ounce before the end of 2011. Gold prices in August have already surpassed this estimate when it rose to $1800 per troy ounce in the second week of August.
Goldman Sachs analysts are also expecting gold prices to continue to rise in 2012. The Wall Street investment bank has raised its three month gold price forecast to $1,645 per troy ounce from its previous forecast of $1,565 per troy ounce. The investment bank said that in its gold price trend analysis, the metal will rise to $1730 in the next six months and will cost $1860 per troy ounce as 2012 approaches. Gold has already risen 20 per cent in monetary value this year.
Investors running scared contribute to a higher gold price trend
The rising gold price trend can be attributed to investors looking for a safe haven in these uncertain economic times. Fear about the falling purchasing power of paper money has further jacked up prices for precious metals like gold and silver.
Asian demand for gold has also been a factor in the rising gold price trends. Chinese investors are looking to invest in gold because of rising inflation. But as the Chinese financial system continues to be deregulated expect Chinese investors to look for other assets to invest in.
Gold has now emerged as an alternate monetary asset for nervous investors. Gold is now longer just a precious industrial metal that is subject to the whims of the global market but an actual currency.
The highest price of gold was back in 1980 when gold hit its all time high of $2,200 per troy ounce. Gold in fact has been constantly rising since dipping in 2008. More and more investors are charging in a volatile gold market. The strong gold price trend in this bullish market will continue for the next three to ten years.
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