BNP Paribas sees the price of gold peaking in 2013, but does not see a “sharp fall thereafter.”
In a report published on Thursday, the firm lowered its 2011-2013 forecasts to in part reflect the yellow metal’s recent weakness.
“After trading sideways in June, gold rallied sharply through July and August,” strategists led by Anne-Laure Tremblay wrote. ”The increase was largely due to safe haven demand, triggered by doubts about whether the US would raise its debt ceiling. S&P’s downgrade of US debt and heightened sovereign issues in the Eurozone further increased risk aversion.”
Tremblay went on to note that “On 6 September, gold reached a peak of US$1,920/oz. However, sentiment soon reversed, and the price subsequently lost 20%, briefly touching US$1,535/oz on 26 September. It has since recovered to US$1,670/oz. Just as in October 2008, the recent drop appeared to reflect sales of gold offsetting losses in other asset classes triggered by extreme risk aversion.”
BNP subsequently stated that “We have revised our gold price forecasts. We now expect the price to average US$1,730/oz in Q4’11 before moving higher to US$1,950/oz in 2012 and US$2,125/oz in 2013.”
The firm’s previous average gold price targets were $1,635 in 2011, $2,080 in 2012, and $2,200 in 2013.
“Our main assumptions are unchanged. We see the gold price peaking in 2013, as the market starts to anticipate monetary tightening in the US, but do not expect a sharp fall thereafter. In the short term, a further correction is possible but this is not our central scenario. The main downside risk may lie with another round of extreme risk aversion, which could spark broad-based liquidation, as in September.”
Platinum Group Metals Purchases Canadian Platinum Project
- The mineralization is in a well-recognized deposit model known as a "Komatiite Hosted" setting.
- The discovery, made during exploration for diamonds, is notable as it is a first for this part of the Northwest Territories.
- The platinum group metals grades are at the top end of the global ranges for the copper nickel mineralization style.
- Platinum Group Metals will utilize the winter season to review and model all of the extensive project data and establish supplies at the exploration camp for a drilling campaign in the spring and summer 2012.
