A SET OF "outrageous predictions" for unlikely but dramatic events today put the 2011 Gold Price at $1800 per ounce if the US Dollar strengthens, sparking fresh "currency wars" across the Pacific.
Saxo Bank's "outrageous predictions" for 2011 also include a record high in US stock markets, oil breaching $100 per barrel (before losing one third), Apple Inc. buying Facebook with its $51 billion war chest, and a 25% drop in the Aussie Dollar vs. Sterling as the UK economy powers ahead and Australia's property bubble bursts.
Looking at the 2011 Gold Price, "Improvement in the US economy, rather than a need to help recovery" would widen the US trade deficit, Saxo warns, leaving President Obama "to twist the US Congress’s arm to pursue a weaker Dollar.
"Pressure piles on China and as investors flee to metals in search of some stability, gold shoots up to $1800 an ounce."
The prediction – made so Saxo Bank clients can "stress test" their portfolios, or buy long-shot options at very low cost – comes amid a flurry of Gold Price forecasts from analysts and traders.
"We are increasingly positive on gold," says Capital Economics, also in London. "The price of gold should continue to be supported by demand for a safe haven from other potential economic and financial shocks...reaching $1600 by the middle of 2011."
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