July 15 (Bloomberg) -- Gold may extend gains from a record as concern about more U.S. economic stimulus and debt woes in the country and Europe boost demand for a protection of wealth, a survey found.
Twenty-four of 27 traders, investors and analysts surveyed by Bloomberg, or 89 percent, said bullion will rise next week. One predicted lower prices and two were neutral. Gold for August delivery was up 2.9 percent for this week at $1,586 an ounce by 11:08 a.m. yesterday on the Comex in New York after earlier in the day touching a record $1,594.90.
Federal Reserve Chairman Ben S. Bernanke this week said the central bank is prepared to take additional action, including buying more government bonds, to boost the economy, while President Barack Obama and congressional leaders have as yet failed to reach a compromise on reducing deficits and raising the debt ceiling. Moody’s Investors Service put the U.S. under review for a credit downgrade and Fitch Ratings slashed Greece’s rating and said that a default is a “real possibility.”
“Investors are once again looking toward gold and the other safe-haven asset types to offset fears of a default,” James Moore, an analyst at TheBullionDesk.com in London, said in an e-mail. “The effect of quantitative easing has been bullish for commodities as a whole but particularly for gold, with the prospect of additional stimulus likely to further widen the timescale for the Fed raising rates.”
The attached chart tracks the results of the Bloomberg survey, with the red bars derived by subtracting bearish forecasts from bullish estimates. Readings below zero signal that most respondents expect a decline. The green line shows the gold price. The data are as of July 8.
The weekly gold survey, which started seven years ago, has forecast prices accurately in 213 of 371 weeks, or 57 percent of the time.
This week’s survey results: Bullish: 24 Bearish: 1 Neutral: 2
--With assistance from Jae Hur in Tokyo and Glenys Sim in Singapore. Editors: John Deane, Sharon Lindores
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