A new report issued on 14 June by the major global bank Standard Chartered has suggested that gold prices could rise as high as $5000 an ounce, claiming; “We are bullish on gold”.
A revision of the bank’s previous prediction of the gold price to reach $2,100/oz, the report cites limited gold production and negligible stimulus in driving further gold production as the major cause of a potential ‘super-cycle’ in the gold price. In effect, the report argues that no serious efforts have been made to boost the gold supply despite a ten-year bull market.
Though it remains to be seen whether the report will spark further bullish activity in global markets, it will certainly generate renewed interest in whether the gold supply can indeed meet demand.
Equally, though such dizzying predictions for the gold price may seem initially outlandish – it has to be remembered that in June 2001, when the gold price had highs of just $274/oz, suppositions of a 465% increase to the current June highs of $1,550/oz must have seemed absurd.