Some concerns on Barclay's new Gold pricing model

In theoretical as well as applied Economics, a 'model' is a simplification of reality- the most basic being demand and supply model. It tries to assess the impact of several independent variables on a dependent variable. Therefore, it looks quite surprising why Barclay's has plunged itself into applied economics to come out with a quantitative (econometric) gold pricing model which it hopes will be quite accurate than its methods of forecasting prices as it is usually the forte of the academicians.

According to Barclays, gold could witness an uptick in 2013 but thereafter face downward pressure in Q4. The average prices for 2013 would be $1394 per ounce however if Federal Fund rates are hiked then it could fall to $1229/Oz but if Fed tapering is delayed it could rise to $1482/Oz as early as october.

Read More: www.bullionstreet.com/news/some-concerns-on-barclays-new-gold-pricing-model/5431