THE OUTLOOK FOR GOLD

摘要

China's growing wealth, Middle East turmoil, oil prices, the U.S. dollar-euro exchange rates, 1 mine production, producer hedging-dehedging--what do these things have in common? Recent price history The average LME cash gold price of 364 dollars/oz in 2003 was 17 percent higher than the 310 dollars/oz average in 2002--the first annual average of more than 350 dollars/oz since 1996. In December 2003, gold prices averaged 407 dollars/oz, the first monthly average above 400 dollars/oz since February 1996. While the increase was largely attributed to continuing weakness in the U.S. dollar, reduced producer hedging has been a factor in gold's higher prices since 2001, as illustrated in Figure 2 on the next page. After Barrick's late-2003 announcement that it would discontinue its policy of hedging, Placer Dome and AngloGold were the only remaining major gold producers with multimillion-oz hedge portfolios.