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Gold Prices set to hold firm, says VTB Capital analyst

Prominent analyst Andrey Kryuchenkov believes two fundamental factors look set to at least hold Gold Prices at their current level for some time to come, Reuters reports.

The dollar extended its recent losses against the euro today (July 24th) after the German Purchasing Managers' index - plus services and manufacturing surveys - returned better-than-expected results.

Mr. Kryuchenkov, an analyst from the VTB Capital, one of Russia's leading universal banks, explained that this weakness in the greenback, allied to inflation fears, should keep Gold Prices steady.

He told the news provider: "The dollar's weakness and the idea that inflation expectations are on the rise are holding gold here."

Last week, Patricia Mohr, vice-president of economics at Scotiabank Group - which is part of the third-largest bank in Canada - also outlined her confidence in the future strength of gold.

In an interview with Reuters, she expressed her belief that Gold Prices will enjoy a surge in the final few months of 2009, motivated by investors reacting to the threat of inflation.

"I expect prices for both gold and silver to have another run-up at some point, as the US dollar comes under further pressure, as sovereign wealth funds and China balk at huge US Treasury issuance and some signs of rising inflation re-emerge - probably towards the end of 2009," she said.

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