Johannesburg, South Africa — MININGREVIEW.COM — 27 October 2009 – Gold is unlikely to trade above US$1 000 an ounce in the “long run,” said Harmony Gold Mining Company chairman Patrice Motsepe, after the precious metal surged above that level earlier this month to its highest on record.
“The recent price spike post year-end at around US$1 000/oz has been largely driven by short-term factors and is unlikely to be sustained in the long run,” Motsepe said in the company’s annual report, published on its Web site. Harmony is Africa’s third-biggest producer of the metal.
The metal reached a record US$1 070.80 on 14 October in London trading, setting it up for a ninth consecutive annual gain, on concern that central banks’ efforts to revive economic growth by printing money would debase currencies and spur inflation.
Harmony CEO Graham Briggs said in the report that gold might still exceed US$1 000 by December “with some upside after that,” given a probable continued “imbalance between demand and newly-mined supply.”
Hedge funds and other large speculators held record long positions, or bets on higher prices, in U.S. gold futures in the week ended 13 October, Commodity Futures Trading Commission data shows. Bets were trimmed by 2% in the week ended 20 October.
Harmony gained R1.24, or 1.5%, to R84.24 in Johannesburg.