Goldman Sachs Remains Bearish on Gold

Goldman Sachs reiterated its bearish view on gold and copper Wednesday, but raised its forecasts for a host of other base metals, saying improved U.S. economic activity will weigh on gold, although the Ukrainian conflict may delay the move of weaker gold prices.

“While we remain bearish on gold, escalating geopolitical tensions in Ukraine have offset stronger U.S. macro data,” Goldman said.

The firm said it continues to see gold prices by year-end at $1,050 an ounce. The silver-price forecast remains at $17.50 an ounce.

For copper, Goldman lowered its three-month, near-term forecast to $6,600 a metric ton from its previous forecast of $7,000 because of Chinese property-sector weakness; however, the firm also raised its 12-month forecast to $6,600 a ton from $6,200. It is keeping its year-end 2013 copper forecast at $6,200 a ton.

In the research note, Goldman said it expects base metals in general to stay weak in the near-term, but by mid-2015 it expects to see supply-demand fundamentals tighten. The firm increased its 12-month price forecast for aluminum to $1,900 a ton, from $1,750.

via Kitco

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