Yellow metal will break $2,000 within the next year, firm predicts
BMO Capital Markets has raised its 2013 price forecasts for
gold and
silver by 14.7% and 11.4%, respectively.
The European Central Bank's intentions to purchase sovereign debt and a new round of quantitative easing by the Federal Reserve that suggests "continued negative real interest rates and appeal for precious metals as a store of value," the Toronto based firm added.
BMO Research said that, it now expects the
gold price to average $1,950 an ounce in 2013 and break the psychological barrier of $2,000 within the next year.
Silver is expected to average $39 an ounce next year.
"They continued that, "for both metals, long-term prices have been increased to account for escalating capital and operating costs."
BMO Research's revised 2013 metal price forecasts imply a
gold-to-
silver ratio of 50:1, compared to the current 53:1. The 30-year historical
gold-to-
silver ratio is 55:1.
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