The largest gold producer in the world has put a very bullish $1,000/oz price target on gold over the next five to seven years. Gold has been flirting with the $500/oz mark over the past few weeks and is currently selling at its highest price since 1987. Newmont believes that the continued increase in gold price will be driven largely by the increased demand from Asia putting us in a supply-demand crunch. The booming economies of India and China are expected to play a continued part in the increasing demand for gold, both in the form of jewelry and as an investment vehicle to preserve wealth.
These comments were made by Newmont's Presidnet in an interview on Australian Broadcasting Corporation. "It (gold) is hot and it is going to get hotter. By early next year you are going to see $525 and down the road even a lot higher than that.'' Mr Lassonde also said that while worldwide gold production last year had the largest decline in 39 years, demand was booming. India, the world largest consumer, saw a 47% increase in the last year and the Chinese bought 14% more gold than the previous year. Central bank sales continue to be a major source of gold on the worldwide market, with a total of 475 tons of gold being sold, which was 14% to global production in 2004.
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