Gold prices may have bounced back in 2014 - surviving a brush with the all-important $1,100 barrier - but it is hard to find much enthusiasm for the precious metal among mainstream investors.
Yet not every investor agrees with this bearish sentiment. James Steel, chief precious metals analyst at HSBC, argues escalating sovereign and geopolitical risks are “gold-bullish. We believe ETF investor liquidation is coming to an end, and we look for gains in gold ETF holdings in 2015. Comex net long positions are also rebuilding and are likely to support prices.” Crucially, Steel points to strong physical demand from Asia as an important support for gold prices, observing that “jewellery, coin, and bar demand fell in 2014 from exceptionally high levels in 2013. We look for a moderate...
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