Gold will rise above US$1,000/oz again in 2008 Lima.– Experts...

Gold will rise above US$1,000/oz again in 2008

Lima.– Experts presenting at the VIII International Gold Symposium in Lima agreed that rising production costs, low US interest rates and strong Chinese demand are creating a recipe for one of the most bullish gold markets in history.

Max Leyton, analyst with Macquarie Bank, forecast that gold will reach US$1,100/oz in this year's third quarter due to the present market fundamentals.


Leyton added that prices are not expected to slump much in the following years. "We see the perfect storm developing for gold in 2009 and 2010," he said.


Meanwhile Greg Barnes, managing director and head of mining equity research for TD Newcrest, said in his presentation that it is unlikely that gold prices will fall below some US$800/oz again in the foreseeable future given the cost pressures producers are facing.


Projects such as Barrick Gold's Pueblo Viejo deposit in the Dominican Republic need a gold price of US$800/oz to be viable given its cost structure, Barnes added.


Gold closed at US$922.750/oz in London on May 22 and has averaged US$914.744/oz so far this year. The metal's 2008 peak occurred on March 18 when it closed at US$1,006.750/oz.