Monday, 5th December 2005 (5001 views)

There seems to be little stopping gold's current bull run.

Prices of gold futures surged to an 18-year high of $508.86 in US trading this morning, while UBS has joined the list of industry experts arguing the price of gold will increase further.

After reviewing its forecasts for gold prices, the broker concluded that the price of the precious metal will bounce by 14 per cent next year before increasing another 15 per cent in 2007.

UBS based its upbeat prognosis on earnings forecasts for companies working in the gold sector. It raised its profit estimates for Lihir Gold by 54 per cent, while it also expects Oxiana, Perseverance and Newcrest to earn more money than original forecasted.

The president of Newmont Mining, Pierre Lassonde, is another industry figure to have recently thrown his weight behind further gains in the gold's price.

He believes the metal could even top the $1,000 an ounce market in five to seven years.

Gold smashed through the 'psychological' $500 an ounce watermark last week.

The price of the yellow metal only stayed above that level for one day the last time it snuck past $500 in 1987.

 

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