Hong Kong - Xinhua
There is no bubble in the gold price and it is basically going up, possibly to surpass 2,000 U.S. dollars per ounce in the near term, as fundamental demand for gold is strong while the supply is subdued, a mining veteran said here on Tuesday. Owen Hegarty, vice chairman of Hong Kong-listed gold producer G- Resources, told Xinhua on the sideline of the Asian Commodities Investment Summit that it was always a good time for individuals to buy gold. The gold price has rocketed from 400 U.S. dollars per ounce around October of 2003, to current 1,700 U.S. dollars after peaking at 1,900 U.S. dollars per ounce in August this year. \"What is happening with gold is that there is a very strong demand factor, whether as a commodity, a currency or as a store of value or as a hedge,\" said Hegarty, who has some 40 years in the global mining industry. On the demand side, investment demand is the primary driver since 2010, followed by growing national reserve demand and demand for gold jewelry as living standards rise, according to Hegarty. Central banks of China, India, Sri Lanka, Thailand, Mexico and Russia are all buying gold, as opposed to selling gold to the market in the last 10 years. That is a fundamental shift in the attitude of the sovereignty institutions, he said. While on the supply side, the supply is actually quite weak and it has been quite subdued. As gold supply is under tension, gold trade will behave in a volatile way, he said. \"We think it will continue to go in what we describe as northeast-lead direction. So I don\'t think there is any doubt that it will spike through 2,000 U.S. dollars in the near term. I don\'t think there is any doubt that it will spike through higher prices.\" Even though there were recession conditions more or less now in Europe and the United States, Hegarty said the world would still see a very strong gold rush.