Gold is likely to reach $2,000 per ounce by the end of 2011, according to precious metals consultancy firm Thomson Reuters GFMS.
In its Gold Survey 2011 Update 1, released this morning, GFMS reported that rising investment demand is likely to lead to further gains in the price of gold.
Earlier this year GFMS was acquired by Thomson Reuters, hence the addition to its name. The Gold Survey 2011 Update 1 marks the first research report published since the acquisition. GFMS will remain an independent research and consultancy division within Thomson Reuters, according to the company.
GFMS’ global head of metals analysis, Philip Klapwijk, commented that sovereign debt concerns in Europe and the U.S. have been a driving force behind the surge in gold investment demand.
“Not only did we have the threatened contagion from peripheral to core eurozone countries but it also crossed the Atlantic in the form of the U.S. credit rating being downgraded,” according to Kalpwijk. ”And both of these were critical to the surge in investment witnessed recently.”
Klapwijk also highlighted several additional factors likely to propel gold prices higher – including recession worries across the globe, emerging markets inflation, continued negative real interest rates, and ongoing conflicts in the Middle East and North Africa.