Gold advanced impressively last week, spurred higher by negative employment data from the US on Friday.
In weekly terms, gold price rose nearly 3.5%, breaking the two weeks of consecutive declines, as euro sovereign debt woes continued to dominate during the week.
Thursday saw market jitters ease as the ECB decided to suspend the minimum credit rating threshold on Portuguese government debt and also upbeat ADP figures helped assuage fears over Friday‘s release of US Non – Farm Payrolls’ data.
However, the downward pressure on the yellow metal decreased in the face of US jobs data as it came in the way off a consensus.
Eric Sprott, founder of Sprott Asset Management and famed investor, predicts gold will continue higher, especially if the US implements QE3. “If we ever have QE3 announced, I think gold and silver will just go absolutely bonkers,” he said. Gold is still in a bullish trend and Eric cautions not to fight the trend, “We have gone up eleven years in a row, this year looks like it will be no exception; I would certainly think next year will be no exception,” he added. His view is that the ongoing “extend and pretend” tactic utilized by world governments and central banks to prop up the fundamentally flawed banking system will lose influence, and you will see capital flows into precious metals that will dwarf the current levels.
