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Experts: Cheapening of gold will continue

17 May 2013 14:19 (UTC +04:00)

Baku. Ali Ahmadov – APA-Economics. Tendency of decline in gold price will continue on world market, APA-Economics reports. In the last 6 days, gold price dropped 5.9% to $1,387 for 1 ounce.

Experts think that at present the longest cheapening process in gold price is going on. Thus, in September of 2011, the prices hit the historical maximum ($1,903) and then started to decline. Consequently, the gold cheapened 27% in the past 20 months. Prices dropped 17% only since the beginning of this year. Reason of decline is related to prosperity of stock markets and reduction of famous investor George Soros’s investments in gold. However, currently, the inflation dropped to minimum, prices of shares began to go up and dollar is strengthening. All these decrease attraction of gold from viewpoint of investment.

Besides, demand for gold bullion and coins is currently increasing in China and India. But the growth of this demand does not exceed the supply on the market – gold sellers are much more. So, according to prognoses of experts, decline in gold price will continue and current price $1,390 will drop to $1,100 by the year-end, and to $1,000 in the coming 5 years.