Even though gold prices, which are currently in the $1745 an ounce range, have dropped since their peak above $1900 an ounce, there is still rational speculation that expects them to rise yet again throughout 2012. Since there are still some very serious economic problems festering in various areas of the global economy, gold should continue to be bought as a safe haven. Also, the growing middle classes in India and China should continue to buy physical gold in mass quantities.
At the same time, the article is cautious because gold has been rising for many years now and may begin to experience some corrections. Also, when compared to an average year, there are fewer special days in India where gold is usually bought and gifted. This may mean less demand for gold. This, in turn, may bring down the spot price of gold globally.
However, the United States' and European debt crisis continues to worry investors and analysts around the world. Since this poses a severe threat to the US dollar, this is actually possibly quite good news for the gold price. This is because the US dollar has temporarily replaced gold as the best safe haven, at least in the eyes of many investors, since September. If the safe haven status of the dollar begins to falter, this would likely cause many investors to shift money into gold yet again. This, in turn, would likely drive up the gold price.
This article also suggests that now may be a good time to purchase gold. While there will likely be many ups and downs, and much depends on how the economy turns, here is another report that predicts significantly higher prices. Always remember that
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