Gold price to average $1 360/oz this year – survey – by Simone Liedtke (MiningWeekly.com – May 8, 2018)

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JOHANNESBURG (miningweekly.com) – Thomson Reuters GFMS expects the gold price to average $1 360/oz this year and potentially briefly approach a 2018 peak towards $1 500/oz on any external shocks later in the year as it believes that the geopolitical climate and equity markets will continue to support gold’s role as a risk hedge.

Political uncertainty, including Brexit negotiations, along with ongoing tensions in the Middle East will remain gold’s key drivers, Thomson Reuters GFMS noted in its fifty-first annual ‘Gold Survey’, published on Tuesday.

The survey further noted that the prospect for higher prices depends on risk hedging at the professional level, while grassroots activity should support a higher base price this year and next.

Meanwhile, physical gold demand increased by 10% in 2017, the first annual increase since 2013. The main driver of this growth was a 13% increase in jewellery fabrication, while Indian demand surged 58% year-on-year as the market stocked inventory ahead of the Goods and Services Tax that was implemented mid-year.

Chinese jewellery fabrication demand fell by 3%, the lowest fall since the market surged in 2013, signalling that the market has now broadly stabilised, with 2017 demand 4% ahead of that of 2012.

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