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.
Get the safest gold at the lowest prices using BullionVault...