upcoming mining journal research

Add new layer of intelligence to your investment decisions Publication of the Mining Journal World Risk Report (feat.MineHutte ratings) is the culmination...

EYEBROW

29 September 2017
Test edition
Test edition

Summary of this Test edition

EYEBROW

26 September 2017

upcoming mining journal jobs

Preaching from the pulpit

Are the days when of CEO hypocrisy coming to an end?

Majors edge lower

Copper, iron ore prices down

Skyharbour upbeat on uranium market and exploration

Exploration kicks off by company and option partners

Leagold plans Brio takeover

Unveils plans for a US$264 million all-scrip offer

upcoming mining journal events

SEG 2017 Conference, Ore Deposits of Asia: China and Beyond

Detailed Event Info: The Organizing Committee is pleased to invite you to the SEG 2017 Conference, Ore Deposits of Asia:...

Commodities > Gold-and-silver

Edison forecasts a bearish US$661/oz gold price by 2021

Edison’s annual mining sector report contains a wider range of gold price forecasts than usual, including a bearish US$661 an ounce by 2021, but the investment research and advisory company said US interest rates might soften a slump.

Staff reporter

Commodities > Gold-and-silver

Edison forecasts a bearish US$661/oz gold price by 2021

Edison’s annual mining sector report contains a wider range of gold price forecasts than usual, including a bearish US$661 an ounce by 2021, but the investment research and advisory company said US interest rates might soften a slump.

Staff reporter

Edison forecasts a bearish US$661/oz gold price by 2021

Research and advisory company shifts gold price forecasting methodology

iStock.com/3quarks

Edison said the total US monetary base, currency in circulation and inflation had historically moved in tandem and gold in tandem with them, but in light of the Fed's plan to shrink its balance sheet by an unprecedented third over the next five years, it had shifted the basis of its forecasting to predicting the gold price solely in terms of future changes in US currency in circulation, which put the gold price at $1,622/oz in 2021.

However, if the US Federal Reserve successfully reduced its balance sheet by $1.48 trillion, and this was reflected in the monetary base, Edison suggested the gold price should fall to $661/oz in 2021 before recovering close to current levels a decade later.

It noted a 39.2% contraction of the monetary base was without precedent in the modern era and it could cause strengthening of the dollar, a deep domestic US recession and material downward pressure on price - which might be averted if growth in currency in circulation could be maintained.

"In this case however, unquestionably the most benign outcome as far as the gold price is concerned is the one in which the total US monetary base contracts, but inflation remains subdued, currency in circulation continues to grow and asset prices (including that for gold) remain high," the report said.

"Nevertheless, we continue to show the results of our other analyses in order that investors may make their own assessments of the future prospects for the price of gold within the parameters of their assumptions regarding the future evolution of the US economy."

topics

loader