Gold Price Steady, Analysts See 2nd-Half 2012 Rebound

GOLD PRICE NEWS – The gold price held steady near $1,645 per ounce Friday morning as the U.S. dollar moved moderately lower against a basket of foreign currencies.  The spot price of gold stabilized in a narrow range in overnight trading – between $1,640 and $1,650 – amid a relatively quiet day in financial markets.  Silver traded near unchanged at $31.74 per ounce alongside the price of gold, while the cyclically-sensitive copper price rose 1.9% to $3.70 per pound.
With no U.S. economic data on today’s schedule, financial markets advanced on the back of strong earnings reports in the technology and industrial sectors.  The S&P 500 Index climbed 0.6% to 1,384.90 in morning trading.
On Thursday the gold price oscillated between positive and negative territory before finishing fractionally higher at $1,641.91 per ounce.  The price of gold showed a muted reaction in aggregate to four key U.S. economic data points, three of which came in worse than expectations.  Nonetheless, with yesterday’s small advance the price of gold snapped a four-session losing streak that had taken the yellow metal to the lower end of its recent trading range.
Silver rose modestly in conjunction with the gold price, by $0.15, or 0.5%, to $31.75 per ounce.  In contrast to the metals, shares of most gold and silver companies closed in the red.  The sector retreated alongside the broader equity markets, as the Philadelphia Gold & Silver Index (XAU) dipped 0.2% to 165.68 while the S&P 500 Index slid 0.6% to 1,376.92.  Two of the XAU’s largest decliners were Harmony Gold (HMY) and Yamana Gold (AUY), which dropped 1.7% to $9.50 and 1.3% to $14.29 per share.
The first economic report released yesterday was weekly jobless claims, which at 386,000 was north of the 370,000 consensus estimate among economists.  Existing home sales and the Philadelphia Fed Index also missed expectations, while an index of leading economic indicators surprised on the upside.
In a note to clients regarding the data, Ryan Sweet – a senior economist at Moody’s Analytics – stated that “The economy has slowed a notch…We’re just not going to be able to duplicate the growth we saw in the first quarter.”
Although the gold price has not fared particularly well in recent months, ongoing economic challenges will help propel the yellow metal back toward its $1,922 record high by year-end, according to a Bloomberg survey of market strategists.  Based on forecasts from the five top precious metals analysts in Bloomberg’s rankings over the past two years, the gold price will average $1,900 per ounce in the fourth quarter of 2012.
The five most accurate analysts surveyed by Bloomberg – Citigroup Inc.’s David Wilson, Deutsche Bank AG’s Daniel Brebner, Prestige Economics LLC’s Jason Schenker, TD Securities Inc.’s Bart Melek, and UniCredit SpA’s Jochen Hitzfeld – also predicted the price of gold will average $1,680 in the second quarter of this year and $1,800 in the third.
Bloomberg also included recent commentary in its report from Jeffrey Sica, president of SICA Wealth Management, who stated that “I don’t think the Fed or any central bank can abandon the policy of easing and as economies weaken and more money is printed, gold will get stronger.  People have lost faith in governments. The overall fear of a worsening debt crisis in Europe will send gold higher.”

source : http://www.goldalert.com/2012/04/gold-price-steady-analysts-see-2nd-half-2012-rebound/