Blanchard experts see catalysts on the horizon for gold
October 25, 2006
The gold and currency markets will be treading water today until we have the release of the Fed decision on interest rates at 1:15 PM our time. We have put together a news release that's going out in front of this decision and I've attached it below. Short and sweet, but makes the point that the Fed decision and upcoming elections are going to be the catalysts for major price movements going forward.
Blanchard experts see catalysts on the horizon for gold
Economic Research Unit expects dramatic growth into the 1st quarter of 2007
NEW ORLEANS (October 24, 2006) - Analysts at the Blanchard Economic Research Unit say a bull market for gold and silver is still very much the reality, despite the fact that precious metals prices have receded about 15 percent since gold posted highs above $725 per ounce earlier this year.
“We believe we’re exiting a period of weak price performance,” says Blanchard Chairman and CEO Donald W. Doyle, Jr. “Along with the entire commodities sector, gold and silver prices have been under significant pressure over the last few months, but we believe this will change in the short term as both continue their upward trend in this precious metals bull market.”
Doyle says the two major catalysts for the next price move will be the Fed’s continued rate pausing and mid-term elections, both of which will put renewed pressure on the U.S. dollar. He added that Blanchard expects gold to climb to $800 by the first quarter of 2007, with silver following suit to reach a new high of $18.
“Gold has been influenced greatly by a number of factors that don’t have much to do with the supply or demand side of the market,” Doyle says, explaining the recent price corrections. “The great thing is that gold is just beginning to exert its role as a monetary asset, and regardless of how other commodities perform, Blanchard believes the next period of the gold bull market will result from investors recognizing that precious metals are currency alternatives - not simply commodities.”
Doyle adds that investors should view these types of market moves as perfect opportunities to buy low in anticipation that prices will jump in the coming months - in essence, there may not be another opportunity to buy again at these prices in the future.
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