Gold outlook for next week remains bullish

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Gold outlook for next week remains bullish
Gold prices this week touched a new high in the futures market, on hopes of further monetary easing by Central banks to strengthen the global economy.

Most market participants expect values for the precious metal could rise again after Federal Reserve Chairman Ben Bernanke announces the outcome of a two-day Federal Reserve meeting, which is largely expecting another round of monetary easing (QE3).

QE3 is a mechanism wherein the central bank buys financial assets to inject more liquidity into the system to push economic growth. Thus more money sparks a rally in commodities. However, the problem with quantitative easing is that it tends to push inflation higher.

There are expectations that the Fed will announce another stimulus plan, which in turn lower the value of the dollar boosting gold sentiment.

Gold climbed on sluggish U.S. Jobs data, which supported investor sentiment that the Federal Reserve would take measures to boost the sagging global economy.

In case, if Federal Reserve fails to announce any monetary measures it could lead to a sharp fall in the metal across the globe.

As per, Kitco News Gold Survey, out of 29 participants, 22 see prices up, while four see prices down for the next week.

Read more about: gold, silver
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