As the advanced economies continue to falter and the boom in commodity prices has also been long since it came to pass; investors appear fixated with the gleam of gold. Trading above $1,600 per ounce, prices of the precious metal have increased by 4.5 percent since the beginning of this year. In the local market too, gold sold at Rs.48,342 per 10 grams, marking a jump of 6 percent since the beginning of this year. News flow from the US economy has been less than encouraging for prospects of a lively economic revival. Job creation and consumer spending-two key measures of economic growth-are both churning weak tallies month after month since the beginning of this year. In the eurozone as well, the European Central Bank is expected to dole out more rescue packages, which will in turn pump in more euros during coming months. As long as money presses continue to churn out more notes to stir an economic revival, investors seem to concur that the precious metal is a safe haven. According to the latest report issued by the World Gold Council; deflationary concerns in some countries, structural issues looming in EU zone and possibility negative developments surrounding dollar might combine to support gold prices in the second half of the current year. "Intervention by central banks in the form of stimulus will help gold break away from the range, but when it will take place is a tricky question," said Nick Trevethan, senior metals strategist at ANZ in Singapore to an international news agency. Deutsche Bank AG (DB) has lowered its forecast for gold, expecting gold to average around $1,726 per ounce in 2012, as opposed to its earlier forecast of $1,800 per ounce. The metal price has averaged around $1,643 since the start of the year. However, the bank expects gold to rally beyond $2,000 per ounce in 2013. If the advanced economies did not respond as hoped, to monetary easing and bailout packages, the precious metal will continue to attract investors wary of losing their moneys worth in the dollar, euro or other currencies.
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