Goldman Closes Gold Position, Says Time to Short
By: Katy Barnato
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Chris Ratcliffe | Bloomberg | Getty Images
Goldman Sachs downgraded its 2013 price target for gold and advised investors to short the precious metal, in a commodities report out on Wednesday.
"Despite resurgence in euro area risk aversion and disappointing U.S. economic data, gold prices are unchanged over the past month, highlighting how conviction in holding gold is quickly waning," said Goldman Sachs analysts Damien Courvalin and Jeffrey Currie in the note.
The analysts cut their gold forecast to $1,450 per ounce for 2013 and $1,270 for 2014, the second cut in their price target this year.
"With our economists expecting few ramifications from Cyprus and that the recent U.S. slowdown will not derail the faster recovery they forecast in the second half of 2013, we believe a sharp rebound in gold prices is unlikely. Given gold's recent lackluster price action and our economists' expectation for higher U.S. real rates, we are lowering our U.S. dollar-denominated gold price forecast once again."
