Gold 'will support the later stages of recession'

Investors are continuing to place their assets into gold bullion because it is the only commodity remaining firm, according to the Hindu Business Line.

Thanks to the big banks' reluctance to lend and the falling dollar, it is widely reported that the US economy is currently under a great deal of stress, leading to a rise in demand for gold bullion as a safe haven commodity.

Some analysts are predicting that, should the present economic climate continue, gold prices could rise as high as $5,000 an ounce, reports the newspaper.

Bill O'Neill, managing partner of LOGIC Advisors in New Jersey, said that he is optimistic about gold futures.

"With the concerns surrounding the other brokerages and banks, it's going to keep the gold market very steady and it's going to keep the demand for hard assets," he said, according to Reuters.

Gold prices stayed above $1,000 an ounce at close of business yesterday after reaching the barrier last Thursday (March 13th).

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