Bloomberg-Gold May Gain on Concern About Sovereign Debts, Survey Shows

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From Businessweek.com
By Nicholas Larkin
March 5 (Bloomberg) -- Gold may gain on concern about European sovereign debts and rising holdings in exchange-traded funds, a survey showed.
Nineteen of 26 traders, investors and analysts surveyed by Bloomberg, or 73 percent, said bullion would rise next week. Six forecast lower prices and one was neutral. Gold for delivery in April was up 1.1 percent for this week at $1,131 an ounce at 11:30 a.m. in New York yesterday.
Demonstrators in Greece, which is struggling to narrow a budget deficit, blocked streets in Athens yesterday to protest austerity measures. Fellow euro-zone members Spain, Portugal and Ireland also face budget gaps. Gold rose to a six-week high of $1,145.80 on March 3 as holdings in the SPDR Gold Trust, the largest bullion-backed ETF, gained to the highest level in seven weeks.
“The growing issue of sovereign debt continues to draw investment demand into the market,” James Moore, an analyst at TheBullionDesk.com in London, said in an e-mailed statement. “Encouragingly, we have seen the return of demand through the SPDR ETF.”
The red bars on the attached chart are derived by subtracting bearish forecasts from bullish estimates, with readings below zero signaling that most respondents expect a decline. The green line shows the gold price. The data shown are as of Feb. 26.
The weekly gold survey has forecast prices accurately in 174 of 301 weeks, or 58 percent of the time.
This week’s survey results: Bullish: 19 Bearish: 6 Neutral: 1
--With assistance from Glenys Sim in Singapore. Editors: Dan Weeks, Stuart Wallace.
-0- Mar/05/2010 00:01 GMT
To contact the reporter on this story: Nicholas Larkin in London at nlarkin1@bloomberg.net
To contact the editor responsible for this story: Stuart Wallace at swallace6@bloomberg.net