Newcrest Mining Confident on Gold Price on Supply, Haven Appeal

Newcrest Mining Ltd. (NCM), Australia’s largest gold producer, expects prices for bullion will “stay strong” in the medium term supported by supply constraints and the metal’s appeal as a haven.

Gold may trade between $1,500 to $2,000 per ounce this year, Greg Robinson, chief executive officer of the Melbourne- based company, told reporters today at conference in Hong Kong. Bullion for immediate delivery last traded at $1,612.70 an ounce.

“If I look at the preconditions for the gold price in the medium term, I think about monetary supply, currency devaluation, interest rate, inflation, political economic drivers,” he told the conference. “I’m confident about the gold price. I expect them to stay strong for the medium term.”

Bullion has rallied for the past 12 years as nations pledged more stimulus to support economic growth and as central banks boosted purchases. Spot gold rose above $1,600 an ounce on March 18 for the first time this month after an unprecedented levy on bank deposits in Cyprus increased investors’ demand for protection of wealth.

“There’s more reasons to own gold today than there have ever been reasons to own gold,” Eric Sprott, the founder and chairman of Canadian fund manager Sprott Inc. (SII), said today at the conference. “I hardly think the crisis is over. The crisis is in full bloom.”

Newcrest shares closed unchanged in Sydney at A$22.50. The stock has gained 1.4 percent this year, compared with the 3.9 percent decline in spot gold.

To contact the reporter on this story: Michelle Yun in Hong Kong at myun11@bloomberg.net

To contact the editor responsible for this story: Jason Rogers at jrogers73@bloomberg.net

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.