The bank says it believes a sharp rebound in gold prices is unlikely and that the fall in prices could end up being faster and larger than its current forecast
by Geoff Candy, MineWeb.com
Goldman Sachs has, once again, lowered its gold forecasts, announcing in a new note that clients should consider shorting the yellow metal.
The bank says that the lack of gold price response to the recent resurgence in “Euro area risk aversion and disappointing US economic data” highlights how quickly investor conviction in holding gold is waning.
Goldman Sachs writes, “With this move lower triggered by the unexpected sharp improvement in the three risks that we initially thought could support gold prices in 1Q13, events since mid-March have finally offered potential catalysts for a rebound in gold prices. And yet, gold prices have remained unfazed by the recent resurgence in Euro area risk aversion and disappointing US economic data, currently trading at their level from a month ago, $1,585/toz.
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