Gold: Prices likely to see an uptick

KOCHI: Year 2010 was lustrous for bullion as prices surged from $900 per ounce to $1,430 per ounce because miners de-hedged risks. But the coming year may not start on a high note, say experts. According to Anand James, chief analyst of Geojit Comtrade, bullion prices in 2011 will be dependent on two key factors: Currency volatility and the state of the US economy. If fluctuation in dollar and euro continue, it could prompt investors to turn to gold as a safe-haven buy. Again, investment in gold could pick up if the US economy continues to face problems. By all indications, bullion prices may move sideways and even dip a little in the short term. But it could move higher by the end of the year as the economic conditions in the US and Europe are yet to reach a satisfactory level, points out Rajesh Mehta, chairman of Rajesh Exports.

As in 2010, gold will remain a good option for investment. The metal showed around 26% growth in value this year. But growth will be slower in 2011, says Suresh Hundia of Hundia Exports. Robust demand in the absence of new supplies will see that prices remain high.