Price of gold stabilized in a narrow range in overnight trading

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.

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.”

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