Goldman Sachs Group Inc. (NYSE: GS) analysts said that significantly lower interest rates in the U.S. will lead to higher gold prices during the next six months, said the company in a research note to investors on Wednesday.
The Wall Street firm’s analysts now predict gold futures will be at $1,300 an ounce sometime between now and February. The firm said that the low interest rates will lead to a high level of speculative gold purchases, which is now oversold.
Goldman Sachs Group Inc. (NYSE: GS)’s analysts also expect that the Federal Reserve will return to quantitative easing measures in late 2010 or early 2011. “We believe that a return to quantitative easing could act as a strong catalyst to carry gold prices to higher levels,” the analysts said.
The Goldman Sachs Group, Inc. (Goldman Sachs) is a bank holding and a global investment banking, securities and investment management company. The Company provides a range of financial services to customers, including corporations, financial institutions, governments and high-net-worth individuals. Its depository institution subsidiary, Goldman Sachs Bank USA (GS Bank USA), is a New York State-chartered bank. It operates in three segments: Investment Banking, Trading and Principal Investments and Asset Management and Securities Services. In March 2010, the Company’s subsidiaries sold the La Francia mine and related infrastructure assets, including Concession 5160, and Adromi Capital Corp., the holder of the La Francia II concession, to a subsidiary of The Goldman Sachs Group, Inc. In May 2010, Nexen Inc. sold its natural gas trading operations to a unit of The Goldman Sachs Group, Inc.
Shares of Goldman Sachs Group Inc. (NYSE: GS) traded down 0.03% on Thursday hitting $149.34 during mid-day trading.
