The delegates of the LBMA conference have a strong record of predicting moves in the gold price, although their forecasts have consistently undershot actual prices in recent years. Last year they forecast gold would be trading at $1,182.50 at the start of this year’s conference.
“It’s very hard to be pessimistic [about the gold price] in the short term – at worst, you’re neutral,” Kevin Crisp, managing director at Mitsubishi, the Japanese trading house, and chairman of the LBMA, told the Financial Times.
Mr Crisp’s comments summarised a resoundingly bullish atmosphere at the conference. Some delegates say gold prices could surge even further, with some analysts and bankers predicting prices above $1,500 an ounce in the coming months as investors stock up on gold in response to uncertainty about the state of the global economy and the effectiveness of monetary policy.
“The degree of uncertainty that is out there at the moment ... has justified a move into gold,” said John Reade, senior vice-president at Paulson, the hedge fund that made millions during the financial crisis and is now buying bullion.
The LBMA delegates said silver would be trading at $24 an ounce in 12 months’ time, up from the current 30-year high of $21.61. Platinum prices would be at $1,857 an ounce, up from the current level of $1,614, and palladium at $702 an ounce, up from $545 currently.
