Gold Stories: 4/14/09

Charting Gold Projections

"FACTBOX-Revisions to precious metals price forecasts "
Author: Jan Harvey
Website: ForexPros.com

We've seen several projections for the 2009 gold price and beyond - as well as several first quarter adjustments - from banks and investing experts alike during the past couple of months. Jan Harvey at ForexPros does a good job of grouping together some of the more significant projections so that we can make a more educated assessment of the yellow metal. Given the significant changes in the market on a daily basis, it's important to consider all opinions when forming our own.

They covered projections from February 18 through April 8 from the following: Canaccord Adams, RBC Capital Markets, Standard Bank, UBS, Numis Securities, BNP Paribas, Barclays Capital, and JPMorgan.

All but UBS provided a year average projection for 2009. Here are a few highlights:

The average projection for 2009 is $923.57. Keep in mind that not included in this group are some within the blogosphere who are projecting $1,500 and even higher for peak gold price in 2009. An average of $923.57 from this esteemed group tells us that, though these are tough economic times, there are forces in place keeping gold from exceeding and staying above $1,000 an ounce. If you have gold and are looking to sell, no need to sit around waiting for the perfect time. Changes won't be that significant.

Outliers had little effect on the average projection. Canaccord Adams projected an average 2009 price of $975 while RBC Capital Markets projects $850. The difference between the two really isn't all that significant, and if you were to remove them from the equation the average of the remaining 2009 average projections is still $928 an ounce. RBC's conservative projection may have teeth considering the price is currently under $900 and increasingly optimistic outlooks could push it down further.

Take a look at the rest of the story for the full rundown. Very good resource for an overview of projections during the first quarter. Will be interesting to take a second and third look later in the year.

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