Analysts foresee no withdrawal of Federal Reserve stimulus for 2 more yearsGold
will rally this year and climb further into 2014 as U.S. Federal Reserve policy makers will probably maintain asset purchases for two more years to buttress the recovery, according to Morgan Stanley.
The metal, which advanced for a 12th year in 2012, may average $1,830 an ounce in the final quarter from $1,715 in the first, $1,745 in the second and $1,800 in the third, analysts Peter Richardson and Joel Crane said in a report today. Prices will supported by investment and central-bank buying, they wrote. ...
"We are skeptical that dissenters within the FOMC on current monetary policy will succeed in overturning the current policy settings before the end of 2014," the analysts wrote, citing elevated unemployment and so-called tail risks to growth. There would be an "ongoing commitment to QE3," they said, using initials for the third round of quantitative easing.
In a separate Bloomberg report
, the firm said: "We remain bullish on the gold price outlook in 2013 despite recent selling pressure triggered by market concerns of an earlier-than-previously-anticipated tightening in U.S. monetary policy," analysts Peter Richardson and Joel Crane wrote in a report today. The bank expects gold to average $1,773 an ounce this year, 4 percent less than an earlier forecast. Prices may gain to $1,845 in 2014.