HomeGoldGold unlikely to move further

Gold unlikely to move further

Mark Cutifani,
CEO, AngloGold
Johannesburg, South Africa — MININGREVIEW.COM — 09 September 2009 – AngloGold Ashanti Limited CEO Mark Cutifani says gold is unlikely “to do a heap more at the moment,” after the precious metal broke through the US$1 000 an ounce level for the first time since March 2008.

In a telephone interview with Bloomberg News, he went on to say: “But given today’s markets, given today’s concerns about what’s happening generally, I think anything is possible.”

Cutifani went on to say that AngloGold was keeping a close watch for signs of a stronger, deeper push in the upwards direction. “If it trades through US$1 020 up to US$1 050, to me that will certainly trigger a rethink on how quick and how strong the gold price could be in the medium to longer term.”

Gold rose to $1,007.70 yesterday, before retreating to $996.58 by 5:14 p.m. in London.

“People are probably more comfortable investing in gold than they are in currencies at the moment,” Cutifani said, adding that gold had reached the US$1 000 mark earlier than he had expected. AngloGold was maintaining its estimate for gold to trade at an average of between US$950 and US$1 000 an ounce in the second half of the year.

AngloGold gained 4 rand, or 1.2 %, to R328 in Johannesburg. The FTSE/JSE Africa Gold Mining Index, comprising five producers including AngloGold, gained 2.3%.

Bloomberg reports that gold’s rally increases the benefit AngloGold shareholders can get from Cutifani’s efforts to reduce forward sales at fixed prices below spot prices.

“We’ve put about US$3 billion (R24 billion) into restructuring our hedge book, and the value that has created for our shareholders is about US$4.4 billion (R35 billion),” he said.