A leading specialist investment manager has suggested that Gold Prices still have an upside of at least five to ten percent, Fin24.com reports.
The yellow metal has proved to be extremely beneficial for those with money tied up in it so far this year and it reached an all-time high of $1,072 per ounce earlier this month.
Now Bradley George, head of global commodities and resources at Investec Asset Management, has revealed that his firm is optimistic about the possibility of further price gains.
"Both in an inflationary and deflationary environment, we are bullish on gold," he said on a conference call, according to the news provider.
Mr. George added that gold is the only currency which is experiencing a decline in production at present, which naturally lends itself to an increase in demand and therefore prices.
This trend was also highlighted last week by the news that DRDGOLD, which is the fourth-largest gold producer in South Africa, may have to shut down one of its key mines.
Eskom, the country's state power utility, is proposing to raise electricity tariffs by approximately 45 percent in each of the next three years to fund the construction of new power stations.
However, Niel Pretorius, chief executive of the gold miner, admitted that it will have to close its Blyvooruitzicht (Blyvoor) facility if the price hikes materialize.
"Eskom's proposed increases will add R70,000 to the underground operating costs of producing a kilogram of gold at Blyvoor by the end of that three-year period," he told MiningMX.
"The underground mine will not cope with that because of the difficulties in saving that amount of cost elsewhere on the operation. We would have to shut it down."
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