Credit Suisse raised its 2012 gold price forecast

Credit Suisse raised its 2012 gold price forecast

Credit Suisse raised its 2012 gold price forecast, saying the clear beneficiary of the uncertainty and dislocations in financial markets has further upside with the crises set to continue.

“Given that many of the factors that have underpinned the rapid increase — most importantly, fears of a global meltdown — remain in place, we expect gold prices to continue to recover over the balance of 2011,” analyst Tom Kendall said in a note.

Kendall now expects prices to peak in the second half of 2012, but continues to expect prices to fall back from their highs in 2013.

The brokerage now sees gold prices at $1,850 an ounce in 2012, from its prior forecast of $1,540. It expects gold prices to average $1,790 an ounce in 2013 and $1,425 in 2014.

Credit Suisse expects silver prices to rise to $33.70 an ounce from $31.25 in 2012 and $30.60 in 2013.

The analysts said a second spike toward $50 is now becoming increasingly unlikely.

Credit Suisse said it did not expect platinum and palladium to reverse the slump in prices during September in light of the uncertain economic outlook.

“However, we expect prices to move materially higher during 2012 from their current relatively low base,” Kendall said.

The analyst also said the fundamental outlook for both platinum and palladium looked encouraging, with supply remaining constrained and continued increases in demand from the auto catalyst sector.

Platinum prices are expected to average $1,775 an ounce in 2012, down from $1,990 and touch $1,995 in 2013, from its prior forecast of $2,200 an ounce.

Palladium is expected to average $771 an ounce in 2012 and $920 in 2013, lower than its earlier forecast of $1,200 in 2013. – Reuters