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Gold Prices 'will hang on to these highs'

A senior figure at Standard Bank Asia claimed today (November 4th) that Gold Prices are likely to maintain their momentum for the remainder of 2009, Bloomberg reports.

The yellow metal has just reached a record high of $1,095 per ounce, underlining the fact that it is now capable of staying in four-figure territory after some previous false dawns.

India's central bank has purchased 200 metric tonnes of gold from the International Monetary Fund and the Fed is expected to freeze US interest rates again this week.

Now Ellison Chu, a Hong-Kong based manager of precious metals at the bank, has explained that these factors - plus strong demand in Asia - should all be to the benefit of Gold Prices.

He told the news provider: "India's purchase had a psychological impact on investors. They think other central banks will also buy gold for their reserves.

"Gold will probably hang on to these high levels. We're seeing good seasonal demand ahead of Christmas and the Chinese New Year."

Those comments come after Bradley George, head of global commodities and resources at Investec Asset Management, revealed that he can still see a five to ten percent upside in gold.

"Both in an inflationary and deflationary environment, we are bullish on gold," he said on a conference call, according to Fin24.com.

Mr. George also noted that gold is the only major currency experiencing a decline in production in the current economic climate, which provokes higher demand and therefore prices.

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