NEW YORK (Kitco News) - The London Bullion Market Association (LBMA) releases an annual survey with the industry's top analysts' precious metals forecasts for the year. The newly released 2016 survey shows that more and more analysts are bullish on gold.
One forecaster, William Adams, head of research for U.K.-based, FastMarkets, says he is expecting gold to work in a range of $980-$1,222 in 2016, with an average of $1,132 an ounce.
'We have had a strong run-up and the market was caught off-guard; we have seen strength come in and some investors who missed the initial [gold] rally are chasing prices higher now,' he said in an interview with Kitco News. Adams added, 'we probably will start running into some resistance soon.'
Gold prices ended higher and hit a 3.5-month high on Thursday with April Comex gold last up $16 at $1,157.30 an ounce.
'Safe haven demand will likely be the swing factor for gold, since equity markets look weak after extremely powerful bull markets, we would not be surprised if money rotates out of equities and into safer havens,' Adams said.
Add the slumping U.S. dollar index to the list of bullish elements helping to drive gold prices. Adams explained that increased concerns over the global macro picture may be underpinning the dollar right now, but still thinks the dollar has already anticipated the first couple of interest rate rises. 'So it may be due for a correction, especially if weakness in financial markets suggest the Fed moved too early,' he said.