Gold is getting more attractive to hedge-fund managers even as Goldman Sachs Group Inc. says the metal’s surprising rally this year will soon fizzle.
Hedge funds and other speculators expanded bets on higher prices for a fourth week in New York futures and are now the most bullish since December 2012, government data show. While gold is off to its best start in six years after topping $1,350 an ounce, Goldman’s Jeffrey Currie says chances are increasing that prices will slump to $1,000 for the first time since 2009.
This year’s 11 percent rally came amid signs of weakening U.S. economic growth and Russia’s incursion into Ukraine. Investors who shunned the metal in 2013 are once more buying the biggest exchange-traded product backed by gold, with holdings poised for the first quarterly gain in a year. Hedge funds also are adding to bullish wagers on sugar, corn and coffee, driving combined wagers on a commodity rally to a record.