UBS: Gold prices will average $1,000 per oz in 2009

Major Swiss banking group UBS has today (February 4th) upped its gold price forecast for 2009 in a new report, according to Dow Jones Newswires.

The bank had already announced around two weeks ago that it was pushing its one-month and three-month predictions up to $900 per ounce and $850 per ounce respectively from calls of $800 per ounce.

However, it has now revised its judgement further and has stated that the price of the yellow metal will average $1,000 per ounce in 2009 as investors continue to seek a safe haven in the current economic climate.

One section of the report, quoted by the news provider, read: "We estimate that (gold) investment demand will double in 2009 compared to 2007.

"Purchases of physical gold have jumped over the past six months as investors' fears about the current financial crisis and the possible outcomes from government efforts to support banks and economies have intensified."

UBS had originally claimed that the gold price would average $700 per ounce over the course of 2009.

The report comes after respected VM Group analyst Matthew Turner claimed last week that investing in gold is on the rise as people believe that the dollar - which moves in the opposite direction to gold prices - is set for a tough year ahead.

"Gold is rising on the fallout from the renewed banking crisis," he told Reuters.

"The banking crisis is bad for share prices and creates fear and panic. Some investors are thinking gold is the safest option."

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