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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: long-gone who wrote (62588)	1/9/2001 8:58:59 AM
From: lorne	Read Replies (1) \| Respond to of 116929

DJ 2001 Gold Seen Hitting 23-Year Low Of $210/Oz - Mitsui LONDON (Dow Jones)--Pressured by thinning trade and the prospect of a rise in producer hedging and official sector sales, the price of gold will fall sharply this year, said a report by trade house Mitsui (MITSY). In his precious metals forecast for this year, analyst Andy Smith said the outlook for gold is bleak, with a low of $210 a troy ounce possible. Even a weakening dollar and the threat of a looming global economic slowdown won't be enough to prevent gold from dropping below the 20-year lows of around $252/oz plumbed in 1999. Gold last traded as low as $210/oz at the end of 1978. In a gloomy outline of the market's prospects this year, Smith said mining companies and central banks - the largest holders of underground and aboveground gold reserves, respectively - will be tempted to start selling ahead of further weakness. For miners, this means selling production forward, a likely consequence of industry consolidation as hedging reduces the overall costs of acquisition, Smith said. For the official sector, it will mean selling gold, then investing the receipts in more attractive financial assets. With the proliferation of asset classes in recent years, gold is losing its allure. Even traditional gold buyers such as Indian consumers will start looking to invest elsewhere, such as bank deposits, Smith said. Demand looks weak, and gold is unlikely to be seen as a store of value in a global economic slowdown, he said. Gold is currently trading at $268/oz, and last traded above $290/oz, Smith's most bullish forecast, at the end of June 2000. 2001 forecasts in dollars/oz: Low Avg High Gold 210 250 290 Silver 3.50 4.25 5.25 Platinum 500 600 700 Palladium 550 750 1,000 thebulliondesk.com