Gold Bull Rally Still Intact After Plunge, SocGen’s Wilson SaysNicholas Larkin
Gold’s bull rally is still intact even after the metal’s drop of as much as 8 percent from a record set yesterday, said David Wilson, an analyst at Societe Generale SA.
Gold futures reached a record $1,917.90 in New York yesterday before erasing the gain and today slumped as much as 5.2 percent to $1,763.80 as increased orders for U.S. durable goods eroded demand for the metal as a haven asset.
Wilson spoke by phone today from London.
“Gold typically corrects when it hits psychological important levels, and my guess is $1,900 is a key level.
‘‘The uptrend is still very much intact’’ and bullion will likely reach $2,000 by the end of the year, he said.
Central bankers from around the world gather on Aug. 26 in Jackson Hole, Wyoming, for an annual meeting that last year saw Federal Reserve Chairman Ben S. Bernanke hint at a second round of asset purchases.
‘‘To a certain extent it’s a wait and see on what happens on Friday to gain a clear sense of the short-term direction.
‘‘The bigger macro drivers, which are still debt levels in the U.S. and Europe, anemic growth in the U.S. and Europe’’ and low interest rates will support gold, he said.
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