Tuesday, August 9, 2011
Meanwhile, back on the financial markets….
Gold touched a new nominal record of $1,716.19 a troy ounce on Monday [currently $1,770!] in the wake of the downgrade of the US government's credit rating by Standard & Poor's over the weekend. But strategists were already looking to the next milestone. JPMorgan encapsulated the bullish sentiment in the gold market, predicting that bullion could hit $2,500 by the end of the year. That would surpass gold's inflation-adjusted high, touched in 1980, which translates to just under $2,500 in todayâ€™s money. "Before the downgrade, our view was that cash gold could average $1,800 per ounce by year end," said Colin Fenton, JPMorgan's head of commodities research, in a note to clients. "This view will likely now prove to be too conservative: spot gold could drive to $2,500 per ounce or higher."