According to the London Bullion Market Association (LBMA), the precious metal gold will undergo an 11.5% increase in price from the record-high annual average in 2020. The gold price is expected to be approximately £1,441 per ounce across this year.
The significant economic recovery from the global pandemic’s drastic impacts due to mass vaccinations is responsible for this expected surge in gold prices. However, governments and central banks will continue their unparallel monetary and debt-spending stimulus.
Interestingly, this entire interpretation is from the analysts who took part in the price forecast competition of precious metals from LBMA. Continue reading to explore more.
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A total of 32 analysts entered the precious metals’ price prediction competition, and 12 out of them speculated that gold price would reach nearly £1,460 or more across 2021. The median prediction for gold 2021 is about £1,435 per ounce.
This means that the annual average gold price of 2020 beat the consensus prediction of LBMA analysts by 13.5%. And this is a record-breaking surge in 15years of LBMA’s competition.
Degussa’s Chief Economist Thorsten Polleit is the highest gold price predictor this year. He entered the competition of LBMA the first time. According to his prediction, the annual average gold price will be about £1,680 this year. The peak value will be £1,957 and the lowest, £1,278 per ounce.
He stated –
“It is far from certain that an extremely easy monetary policy will pave the way towards a sustainable economic recovery. In any casem price inflation – be it in the form of consumer and/or asset price inflation – will be the result.”
BioNtech/Pfizer reported that after successful trials of Covid vaccine, gold price bottomed at about £1,289 by the end of November. However, Noah Capital Markets Research’s Rene Hochreiter made the lowest price prediction of gold in 2021.
He predicts that the 2021 gold price will peak at about £1,343. Hochreiter added –
“After the fastest recovery in the history of the global equity markets, gold may see an equally sharp decline as risk and volatility fall.”
“Technically, gold ahs not convincingly broken out of the bear market it has been in since August 2020 and seems intent on not doing so.”
On the other hand, Ross Norman – the 2020 winner of LBMA competition – says “with the recovery comes demand-pull as well as cost-push inflation, further fuelled by the higher velocity of money leading to expectations of much higher inflation.”
Norman forecasts an annual average gold price 2021 of nearly £1,479 saying that “we see concerns shifting from herd immunity to herd insolvency. Financial markets remain vulnerable, and we think investors will continue to see gold as the near-perfect antidote.”
Gold is considered to be a safe-haven asset. Whether your gold jewellery piece is tangled, broken or old, it is still worth something. If you want to secure some extra cash to meet your short-term financial needs, you can use your gold item as collateral for a pawn loan.
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