Gold Price Predictions for 2014

Since centuries, governments have issued paper money and tried their best to overtake gold – but it continues to remain the universal medium of exchange! However, despite gold’s overall bright future, the gold price prediction for 2014 is looking rather dim, say experts. Given that this prediction comes from six eminent banks that operate globally like Merrill Lynch; Barclays; Deutsche Bank; HSBC; J.P. Morgan and UBS, investors are taking it rather seriously.

The Wall Street Journal’s ‘Market Watch’ reports on – how the ‘consensus’ gold price prediction for 2014, is that it will go down by 14.5 % compared to the previous year. “Gold will average $1,209 an ounce this year, judging by recent forecasts from six big banks. That average of their individual calls represents a drop of 14.5% from the precious metal’s average price in 2013 (which was $1,413 per ounce, according to a Deutsche Bank note),” it states. “Deutsche Bank, as the table above shows, is most bearish of the six, seeing an average price in 2014 of $1,141 an ounce, while HSBC is the least bearish at $1,292,” it informs.

Factors Responsible For Dim Gold Price Predictions for 2014

Financial and investment analysts are holding a number of factors responsible for their gloomy 2014 gold price prediction. Fundamental among these is that, buyers seem to have lost interest in buying the yellow metal. “If investors stopped selling gold, prices could stabilize around $1,200/oz. Yet, this is not our base case and a more likely scenario is for investors to continue reducing their exposure. Our model suggests that this could take prices down to $1,000/oz.” This is revealed by ‘Bank Merrill Lynch’s,’ strategist, Michael Widmer in another ‘Market Watch’ report. He states here, that – ‘his biggest gold worry is a lack of buyer interest, as investors have been a marginal driver of prices in recent years.’

He notes in this ‘gold price prediction report’ with much disdain, that –‘not even traditional buying of physical gold will be enough to keep prices from falling.’ Detailing out exactly why this will be so, the Bullion Bulletin states: “India is unlikely to strongly support gold in 2014, as it has in years past, thanks to government restrictions on gold imports. The country, which closely competes with China as the world’s largest gold consumer, has tried to cut gold consumption to narrow trade deficits this year.”

Recent Gold Price Prediction for 2014 However Seem More Upbeat

While others continued to remain pessimistic about gold price prediction in 2014, UBS AG, recently boosted its forecast, “citing a change investors’ attitudes toward the precious metal that’s rallied this year on increased haven demand and buying from consumers,” Bloomberg News reported. The analysts noted that, ‘signs that the economy wasn’t recovering in line with expectations,’ had also contributed to gold climbing to its highest in the past three months. UBS AG’s Precious metals analyst- Joni Teves, who had in a December 2013 research note, predicted that – ‘a substantially more upbeat global economy and bullish stock market would make gold suffer in 2014;’ in her February 2014 report said: “Gold has started to shed its stigma, if slowly.”

A Silver Lining to the Gold Price Predictions for 2014

While only the future will show whether the ‘initial’ or ‘the more recent’ – gold price prediction for 2014 is more accurate; experts still advise caution when buying gold! They warn that, gold prices despite some “ups” in recent days may continue to fall further in the next few years. However, for optimistic gold enthusiasts who can afford to take the risk, even such a scenario offers opportunities!

In this context, Irwin A. Schiff- a prominent American tax protestor, said it best when he said: “All of the government’s monetary, economic and political power, as well as its extensive propaganda machinery, will be enlisted in a constant battle to drive down the price of gold – but in the absence of any fundamental change in the nation’s monetary, fiscal, and economic direction, simply regard any major retreat in the price of gold as an unexpected buying opportunity.”

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