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Gold prices may fall 3.5% in December quarter; resurge by March

Gold prices are likely to fall more than 3.5 per cent from its peak after a 16 per cent rally last quarter as investors resort to year-end profit-taking while tepid wedding demand weighed, a poll of banks and brokerages found.

The most-active gold for December delivery on the Multi Commodity Exchange (MCX) struck a peak of Rs 29,212 per 10 grams on Tuesday, from where it has slipped to be at 28,440 on Friday morning.

Gold could test Rs 27,500 per 10 grams by December end, according to a median of Reuters poll of 10 participants, which included State Bank of India and Scotia Mocatta, the country’s biggest importer of bullion.

Imports fell 20 per cent in the July-September to just 200 tonnes, the World Gold Council said, and the demand so far in the peak wedding season has been lacklustre.

According to the poll, the minimum target for the yellow metal was Rs 25,000 in the December quarter.

ANOTHER PEAK BY MARCH

The yellow metal is likely to recover to 28,870 rupees by the end of first quarter of the next calendar year and could power to record 29,375 rupees in the June quarter on inflationary concerns, according to the poll.

“The demand for gold as a safe haven commodity can return and gold can again move higher,” said Rohit Dubey, research associate with ADMISI Commodities in Mumbai, who expects gold to touch 29,200 rupees in March quarter of next year. – Reuters

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Posted by on Nov 25 2011. Filed under Gold predictions. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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