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Gold May Gain This Week as Slowdown Spurs Investor Demand, Survey Shows
Gold may advance on speculation the U.S.’s economic slowdown will spur demand for the precious metal as a haven from declines in other assets.
Thirteen of 18 traders, investors and analysts surveyed by Bloomberg, or 72 percent, said the metal will gain next week. Three forecast lower prices, and two expected little change. Gold for December delivery was up 1.1 percent for this week at $1,251.70 an ounce at 11:49 a.m. yesterday on the Comex in New York.
Gold gained 5.6 percent last month, the biggest increase since April. The metal rose to as high as $1,256.60 an ounce on Sept. 1, within 1 percent of a record $1,266.50 reached on June 21.
The precious metal’s advance in August and the recent high “is bullish technically,” Mark O’Byrne, executive director of brokerage GoldCore Ltd. in Dublin, said in an e-mail. “The fundamental backdrop remains very sound, with the U.S. and many other economies internationally on the verge of a double-dip recession, leading to robust investment demand.”
U.S. employers eliminated about 100,000 positions in August, the third straight monthly decline, according to the median estimate of economists in a Bloomberg News survey. The unemployment rate rose to 9.6 percent from 9.5 percent, according to the survey. The Labor Department’s payrolls report is due at 8:30 a.m. New York time today.
The red bars on the attached chart are derived by subtracting bearish forecasts from bullish estimates, with readings below zero signaling that most respondents expect a decline. The green line shows the gold price. The data shown are as of Aug. 27.
The weekly gold survey that started six years ago has forecast prices accurately in 187 of 326 weeks, or 57 percent of the time.
This week’s survey results: Bullish: 13 Bearish: 3 Neutral: 2
To contact the reporters on this story: Chanyaporn Chanjaroen in London at cchanjaroen@bloomberg.net.
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