Gold News

Gold Price “Not Expensive” at $1400

CURRENT LEVELS in the Gold Price remain attractive, according to a leading London analyst, and certainly don't signal anything like a bubble.

“Even at $1400 per ounce,” says Michael Lewis, chief commodity strategist at Deutsche Bank in London – speaking to CNBC – the Gold Price “is not expensive.”

Lewis's team reached that conclusion after comparing Gold Prices with equities, industrial commodities, and real incomes worldwide.

“Gold needs to hit $2000 and above [before] we would start to get quite nervous,” he told the finance news channel this morning.

Calling $100 oil “very likely”, Lewis also said that physical-market fundamentals across the commodities spectrum – but especially in energy and base metals – are now supportive of further gains ahead.

Prices for immediate delivery are now equal to or even above longer-term prices for future delivery. Such “backwardation” means there's tight supply and strong present demand.

Furthermore, due to strong Gold Investment demand – now accounting for 50% of global gold buying – “We're now in an environment where gold can go up when the Dollar's rising or falling,” says Lewis.

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