NEW YORK (AP) Analysts for Goldman Sachs on Monday predicted that low interest rates will keep gold prices climbing for the rest of this year and into 2012.
The price of the precious metal has been on the rise for several years, as economic uncertainty has driven more investors to its relative stability.
In afternoon trading, the price of gold was down $7.70 at $1,780.40 per troy ounce on the New York Mercantile Exchange. So far this year, the price of gold is up about 26 percent.
Compared with the same time last year, price of gold on the New York Mercantile Exchange is up about 31 percent. Over the past five years, its price has more than doubled.In a Monday note reviewing the values of various commodities, Goldman analysts said that global growth will continue to drive prices of commodities, including gold, higher over the next 12 months. "We expect gold prices to continue to climb in 2011 and 2012 given the current low level of U.S. real interest rates, and as a result recommend a long gold position," the Goldman analysts wrote. The analysts raised their price forecasts for the precious metal, including their 12-month forecast to $1,930 per troy ounce from $1,860 per troy ounce. The jump in gold prices has helped fuel steep jumps in profit at gold producers this year. Last week, South Africa's Anglogold Ashanti said its third-quarter profit rose 34 percent to $457 million. And Toronto-based gold miner Barrick Gold Corp. said late last month that its third-quarter profit climbed 45 percent, largely as a result of higher gold prices. But the slight drop in gold prices on Monday amid a broader sell-off sent shares of gold producers down. Anglogold Ashanti's U.S. shares dropped $1.98, or 4.1 percent, to $46.85, while Barrick's fell $1.11, or 2.1 percent, to $52.06.
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