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POLL-ANALYSTS' VIEW-Reuters Q3 precious metals price poll
October 10, 2012 / 1:01 PM / 5 years ago

POLL-ANALYSTS' VIEW-Reuters Q3 precious metals price poll

LONDON, Oct 10 (Reuters) - Precious metals analysts have
become more bullish for the prospects for gold and silver than
they were three months ago, but their outlook for platinum and
palladium has darkened in line with the outlook for global
growth, a Reuters poll showed on Wednesday.
    The impact of the euro zone debt crisis on the global
economy is expected to keep global monetary policy loose, which
should favour gold, while restricting demand for the more
industrial metals like silver and the platinum group metals.
    Silver should get a lift on the back of gold, while the PGMs
will be cushioned to an extent by ongoing supply disruptions in
South Africa, although the prospect of weak car sales has
prompted most analysts to scale back their price forecasts.
    Below are comments on the outlook for the four metals.
                    AVG Q4        AVG 2012    AVG 2013
    Mean            1795.06    1690.97    1862.40
    Median            1785.00    1690.00    1853.75
    Highest            2200.00    1780.00    2500.00
    Lowest            1630.00    1640.00    1520.00
    No. of forecasts    27        28        28
& CO
    "Gold is reasserting itself as a strong safe haven during
the current period of risk and uncertainty. The European debt
crisis remains a major issue in the global economic marketplace,
and other major indicators in the U.S. and abroad continue to
illustrate just how feeble the economy remains. Many investors
have moved into gold to protect and grow their wealth, and we
foresee global investment demand for gold to grow even further
than the 900 percent increase it has seen since 2007."
    "2012 was always going to be relatively tough for gold just
as 2004 was and 2008 was, and for much the same reason - they
were all U.S. election years when the dollar did comparatively
well. With a run rate of a 17% year-on-year gain over the last
decade, gold looks likely to post a modest 12 percent in 2012. 
    Gold is likely to hold its relationship with the US dollar -
in 2012 we inversely seen rupee and euro weakness which has
translated into all time highs for gold in both of these
currencies - this remains a drag on what might have been runaway
gold prices. The relationship will be put to the test when
brinkmanship over the US fiscal cliff emerges in the new year,
which could easily propel gold back to all time highs above
    "Gold still remains a virtual currency in the eyes of many
people and can act as a form of last ditch insurance. Given the
strains that currently exist in the global economic system, we
expect gold to continue to benefit from heightened risk and
increased perceptions of risk."
                    AVG Q4        AVG 2012    AVG 2013
    Mean            34.88        32.01        36.99    
    Median            35.00        32.00        35.00
    Highest            41.00        35.00        65.00
    Lowest            31.50        30.50        30.00
    No. of forecasts    26        27        27
    "Over the medium term, our concern with the outlook for
silver prices is that once global markets return to greater
normality, investment demand might not only diminish, but could
turn into a considerable source of net supply.  The 16,160
tonnes of silver held in physically-backed ETFs are equivalent
to almost half of 2011's supply of silver and 70% of new mine
    Earlier in the year, signs of an improvement in the US
economy hinted at a possible net outflow, but the situation
reversed during the summer months, and with the introduction of
a third round of QE, the resultant boost to silver prices from
renewed investor demand is likely to take the price of silver
for the year as a whole to an average of $32/oz. followed by
30/oz in 2013."
    "Investment demand in 2011 was 163.9m oz and this should
need to rise to 218m oz in 2013 if the market is to be in
balance. This should not be a problem following QE3, but 2013
should need 214m oz and 2014 should need 212m oz of investment
demand if the market is to be in balance. With QE3 a distant
memory by then, we believe that the market should only find a
balance at lower silver prices."
                    AVG Q4        AVG 2012    AVG 2013
    Mean            1640.69    1577.17    1737.93
    Median            1650.00    1559.50    1722.50
    Highest            1750.00    1800.00    1950.00
    Lowest            1450.00    1500.00    1525.00
    No. of forecasts    17        18        20
    "Even though there is scope for platinum prices to decline
as the crisis in the Eurozone unfolds in the near-term, a
correction would magnify the problems for South Africa's miners.
This should limit the downside. By the same token, once the
global economy stabilises, in our view platinum prices 
could rise above $2,000/oz through 2013 and into 2014." 
    "The overriding trend in the platinum market has been the
unprecedented level of supply disruptions, through a combination
of illegal strike action, weak pricing which had led to closures
and section 54 safety stoppages at the beginning of the year.
    "However, weak demand and a well-stocked auto sector have
simply meant that these supply disruptions prevented a
significant inventory build-up over the course of 2012 ...
depending on the duration of the current strike at Amplats' four
Rustenberg shafts - Khuseleka, Khomanani, Thembelani and
Siphumelele, this surplus could easily evaporate by the year end
to leave the market in balance for 2012 as a whole.
    "The starting point for 2013 is therefore a much more
balanced market. We believe that any squeeze in the platinum
market which could see the platinum to gold premium return, is
more likely to occur in the second half of next year."
                    AVG Q4        AVG 2012    AVG 2013
    Mean            675.57        657.90        753.41
    Median            658.00        643.50        742.00
    Highest            750.00        800.00        900.00
    Lowest            630.00        615.00        660.00
    No. of forecasts    17        18        20
    "Palladium may not suffer any deep corrections, and we
expect a steady improvement in prices with a test of $800 in the
second quarter of next year and a challenge of $1,000 in 2014.
Palladium remains our favoured precious metal for the long
    "We feel that the PGMs are likely to remain far more
sensitive to wider macro-economic conditions than silver given
the scale of investor appetite for silver. While we maintain a
bullish outlook for gold and silver next year we are not as
optimistic for the PGMs given the increasing levels of scrap
recycling and current fundamental imbalances."         

 (Reporting by Amanda Cooper; Editing by William Hardy)

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