The FEDERAL RESERVE's second dose of quantitative easing – widely called QEII – will prove "game changing" for commodity markets and push Gold Prices higher still, according to new analysis.
Alongside higher targets for palladium and base metals led by copper, Swiss bank UBS has raised its 2011 Gold Price forecast by 8% to $1400 per ounce.
"Recent Fed commentary makes it a virtual certainty that we will get QE2 at the next meeting on Nov. 3," write analysts Julien Garran, Tom Price and Edel Tully at UBS.
Perhaps totaling more than $1 trillion according to Goldman Sachs' analysts, "This will be a game changer for commodities," says the Swiss bank's team, certain to "prolong the bull market in commodities."
The Gold Price has risen almost 8% since the start of September, when the US central bank signaled its intention to create yet more money and buy US Treasury bonds and other assets. So "The immediate impact of any QE2 has probably already been factored into the Gold Price," says the latest Metals Monthly for ABN Amro Bank from London's VM Group consultancy.
But looking ahead, VM has also raised its price target to $1496 for the second quarter of 2011.
Goldman Sachs last week raised its 12-month target on the Gold Price to $1650.
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