The CEO of Goldcorp raised the gold forecast

The CEO of Goldcorp raised the gold forecast

Chuck Jeannes, CEO of the world’s fifth-largest gold mining company, Goldcorp, raised the gold price forecast late last week. At first, he expected the price of gold to surpass the $ 1,600 mark by the end of 2011 alone, but has now raised his forecast to $ 1,700 an ounce by the end of 2011.

Current macroeconomic conditions are favorable for gold mining companies, especially the rise in prices will be driven by problems of central banks with major currencies, as well as by growing debt obligations in developed countries.

Jeannes also pointed to rising inflation in China and India as a major factor in the pressure on rising gold and silver prices. Due to inflation, the demand for gold in China may soon exceed the demand for gold in India for the first time. He reiterated his view that the bullish market of the last decade is likely to continue in the coming years. In addition, supply and demand data show that the gold market is not balanced: demand exceeds supply, which will further contribute to rising gold prices. Goldcorp has no plans to protect its gold production from future gold price volatility.

More and more investors are buying gold as a “safe haven” to protect their savings from the economic problems of developed countries. Apparently, these problems will only get worse in the near future. Governments in developed countries are in no hurry to solve their countries ’debt problems, postponing the solution for a longer period. Investors are concerned about the instability of the global economy and, in particular, the economic problems in the United States. All of these are the main reasons capital flight to gold. On top of all this, central banks around the world continue to risk their currencies for commercial advantages. Finally, Jannes added that fear of rising inflation is forcing many people to buy precious metals as a stable investment alternative.

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