Dollar vulnerability to 'maintain Gold Investment interest'
VTB Capital analyst Andrey Kryuchenkov believes demand for Investing in Gold will continue to remain strong due to concerns about the US dollar, Bloomberg reports.
October tends to be a slow month for the yellow metal and some market observers are predicting a sharp correction from the record high of $1,070 per ounce attained last week.
However, Mr. Kryuchenkov from the investment banking division of one Russia's leading universal banks has explained that the greenback - which tends to move in the opposite direction to gold - looks set to remain its primary driver.
He told the news provider: "It is still too premature to short gold. The dollar remains vulnerable and investor appetite for gold could re-emerge very quickly."
A similarly optimistic view was outlined last week by Adrian Koh, an analyst at Phillip Futures.
He explained that the weakness of the dollar is provoking fears about the prospect of inflation and could see investors continue to Buy Gold as a hedge against such an eventuality.
"It's really difficult to pick a top. Until we get any strong change in fundamentals for the dollar, then it may continue to weaken further and everyone will flock to gold as a hedge," he said in an interview with Reuters.
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