Salient to Investors:
Jeffrey Currie and Damien Courvalin at Goldman Sachs said:
- Gold will fall into 2014 as the Fed tapers on the back of an acceleration in US activity and a less accommodative monetary-policy stance.
- Goldman’s economists expect tapering next week.
- Goldman maintained 3 and 6-month targets for gold at $1,300, and said its 12-month target is $1,175.
Societe Generale, Citigroup, ABN Amro and Macquarie predict lower gold prices in 2014 as the global economy recovers and inflation fails to accelerate. JPMorgan Chase and Bank of America say gold may be bottoming as the rout boosts demand.
Investors sold 683.3 metric tons of gold from ETPs in 2013, reducing holdings to 1,948.6 tons after peaking at 2,632.5 tons in December 2012.
Societe Generale said gold will drop to $1,200 by the end of the year on sales from ETPs and a reduced likelihood of US military action against Syria.
The median analysts expects the Fed to reduce Treasury purchases by $10 billion a month from $45 billion and maintain mortgage-bond buying at $40 billion, and the program to end in June.
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