GOLD MARKET FORECASTS: Are Completely Worthless
To prove my point, lets look at three different forecasts from Thompson Reuters GFMS this year.
JAN 16, 2013:
GFMS Sees Gold Climbing Toward $1,900 on Central-Bank Stimulus
Gold will climb toward $1,900 an ounce and average a record in the first half of this year as central-bank stimulus boosts investment demand, according to Thomson Reuters GFMS.
While investment fell 1.2 percent last year in tonnage, it set a record of about $87 billion as prices averaged the most ever, and will jump 20 percent in the first half from a year earlier, the London-based researcher said today in a report. Central banks added the most gold to reserves in 48 years in 2012 and will buy another 280 metric tons in the first half, countering a drop in jewelry purchases and higher recycling.
Here we can see that GFMS states gold will hit $1,900 and average a record in the first half of the year. Well, of course that didn’t happen as we had two big take-downs in April and June.
Then we had the next forecast be GFMS in April:
April 4, 2013
Thomson Reuters GFMS Sees Gold Returning To Mid-$1,800s In 2013
Thomson Reuters GFMS said Thursday that it looks for gold to climb back to the mid-$1,800s before the end of the year.
….The report said that U.S. developments will remain a key factor driving gold price movements over the course of 2013. While improving but still patchy economic data contributed to a softening of the gold price in recent months, the consultancy said it feels this is already is already priced into the market. Meanwhile, there is a continued lack of confidence that ongoing debate over budget cuts and raising the debt ceiling will result in a satisfactory and timely resolution.
However, Thomson Reuters GFMS did offer caution for further into the future. “There’s arguably clearer light at the end of the tunnel in that we can perceive a return to something more like normality for the macro-economic backdrop, and that could easily entail the start of a secular bear market, perhaps in late 2013 or more probably in 2014,” Meader said.