Gold Bullion Continues Upward While Equities Take It on the Chin

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Toronto’s National Bank Financial Equity Research Division has revised its 2007 & 2008 gold forecast to $675/oz, $625/oz for 2009, $575/oz for 2010 and $525/oz long term.

Toronto’s National Bank Financial Equity Research Division has revised its 2007 & 2008 gold forecast to $675/oz, $625/oz for 2009, $575/oz for 2010 and $525/oz long term. In her May 28th World Gold Producers Quarter, Precious Metals Analyst Tanya Jakusconek said she believes that currency will be the main driver of gold prices this year, followed by the oil prices, with interest rates as a third driver. “In the commodity markets, low central bank activity (fewer sales than in 2006) and more investment demand (through ETFs and speculative interest) will be important contributors to the demand for bullion,” she explained. “On the equity front, we continue to expect that in 2007, gains will be very stock specific. A strategy for maximizing returns would be to identify companies with short to medium-term production growth, low operating costs (hence margin expansion), good exploration programs adding to reserves and resources and growing net asset values.”

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