On the Line with Gold Price Forecast : Year-end $1226 Predicted


Chief Economist predicts an average price of $1170 and a year-end figure of $1226.

Dr Martin Murenbeeld, Chief Economist of Dundee Wealth Economics of Toronto, put his forecasting on the line at this year's Denver Gold Group Zurich Gold Forum. His predictions are based on three possible scenarios, all given different probability ratings—and then a weighted average figure.

Murenbeeld's predictions are always backed up with some extensive analysis. He looks not only at the bull points, but also indicates risks. This year's bullish points include reflation, a declining dollar, excessive global FX reserves, and the Central Bank's improving attitudes towards gold. Bearish possibilities include policy exit strategies in the U.S., Asia, and Europe; a strong dollar/weak euro perception; an absence of inflation; and a pop in the Chinese growth bubble.

A couple of years ago he was just about spot-on with his weighted average, and last year he was slightly on the conservative side—but got the overall trend right. This year he is forecasting an average price of $1170 and a year-end figure of $1226—not unreasonable, but the true gold bugs will feel he is being conservative again.

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