hi Bob , long time no chat. love your experiences in the all round world current events.
RE: Gold price to rise long term -China c.bank official Reuters Reuters - Friday, May 30
SHANGHAI, May 29 - International gold prices are likely to rise further in the long term due to dollar depreciation, rising demand and global political and economic uncertainty, a researcher at China's cental bank said. ADVERTISEMENT
Worries about global inflation, a possible worldwide economic slowdown and geopolitical instability will also bolster the metal's price, Wang Yu, director of the gold and foreign exchange market division of the People's Bank of China, told an industry conference.
"My personal conclusion is that international gold prices will remain volatile in the short term, while from a long-term perspective there is a possibility for -- and room for -- prices to increase further," she said.
The spot gold price powered to a record high of $1,030.80 an ounce on March 17. The price has since retreated and was trading around $894 on Thursday.
Wang said she believed that the U.S. dollar was likely to depreciate further despite a recent rebound. Gold often moves in the opposite direction to the dollar, which tends to weaken when U.S. interest rates are cut.
On the demand side, Wang said rising prices would actually be likely to encourage buying in developing countries, where the metal is considered an important store of value.
"Global gold demand is increasing steadily with strong economic growth in developing countries, but the supply of the metal is stable," Wang said. "That creates a deficit."
Gold demand in China, the world's second-largest jewellery market, is expected to rise this year despite high prices that have depressed demand elsewhere, Philip Klapwijk, executive chairman of metals consultancy GFMS Ltd, said on Wednesday. [ID:nSHA163133]
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