"Investor demand now is the main driver for gold pricing, while traditionally important physical supply and demand components, such as jewelry demand and mine supply, have recently exerted little influence on day-to-day moves in the gold price," analyst James Steel said in the note.
Central banks, including Russia, Thailand, Mexico and Vietnam had also played a hand in supporting the market in recent months as buyers.
"After many years as a contributor to supply, central banks have swung to being net buyers. We believe this is an important development that will support prices going forward. The signatories of the third Central Bank Gold Agreement sold little gold in the compact's first year, through end-September 2010," Steel said.
HSBC also raised its forecasts for silver in 2011 to $34/oz from $26/oz, and to $29/oz from $20/oz in 2012. For 2013 the newly introduced forecast was $24/oz.
"Just as the case for gold, silver prices have benefited from demand for hard assets stemming from the 2007-09 financial crises and the monetary and fiscal responses," Steel said.
"Increases in mine and scrap supplies will be offset by robust industrial demand, we believe. More than half of the annual silver supply is regularly consumed by industrial sectors," he added.
Turning to the PGMs, HSBC raised platinum in 2011 to $1,850/oz from $1,750/oz and for 2012 to $1,750/oz from $1,650/oz. For 2013, it put the price forecast at $1,650/oz. Palladium predictions climbed to $825/oz from $750/oz for 2011, to $750/oz from $650/oz for 2012 and to $725/oz for 2013.
"Palladium has benefited from the recovery in global auto production. The industry traditionally absorbs more than half of annual palladium production, required for production of autocatalysts and particulate filters," Steel said.
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at 1800 dollars an ounce they are off... silver is 36 an ounce. Ide say you guys are living in a bubble'''lol By the end of 2012.... Gold will be 2300.00 and silver will be around 70.00 You'll see.... Invest People.
ReplyDeleteif you can wait 3 years, I believe gold will be at 6000.00 and silver at about 450.00.
When the dollar and the uero fall...precious metals go up. and with china buying all the gold and silver they can get their hands on...well you do the math....INVEST NOW...
I will be holding a party and you are all invited