Analyst says gold will be corrected only temporarily before doubling
A fund analyst said on Tuesday that gold will most likely see a correction soon as its spot prices saw a record high of $US1,249.70 last week, which experts attributed to the economic uncertainties spawned by the Greek sovereign debt crisis.
H3 Global Advisors fund manager Mat Kaleel is confident the precious metal is destined to go a long stretch run in coming years, despite its price declining a bit this week and its value still below the 1980 levels as against the rate of the present US dollar.
He said that last week's price was indeed a record as far as nominal price is concerned, but if the 1980 price were adjusted for inflation, gold's value would have been priced in today's dollar at $US2,300.
Mr Kaleel argued that gold has to be doubled to return to the inflation-adjusted high, stressing that "when we say gold can get to $US2,000 or $US3,000 we are saying it probably is just going to get back to where it was when you adjust for inflation."
He said that a correction on gold is almost automatic, citing that historic slid on gold prices could reach up to 15 percent as he advised that we should be expecting "a good correction around these levels, but it will form a base again, as it has for the past 10 years."
Mr Kaleel pointed to the economic woes being felt in America and Europe as the main culprit in the mounting interest in gold as investors are rushing on investments that would afford them cushions in the event of further meltdowns occurring.
As of 1631 AEST, gold in Australian markets is being traded at $US1,221.80 per fine ounce, losing $US15.20 per ounce from Monday's closing price of $US1,237.00.