London, 6 January 2012

Forecast 2012 predicts gold at $1,766/oz: The following table summarises the results of Forecast 2012, the LBMA’s annual survey on the direction of precious metal prices for the coming year.

A total of 26 contributors gave their estimates for the high, low and average price for 2012 for gold, silver, platinum and palladium, with a brief commentary on the major influences and activity for each metal covered.

In 2012, Forecast contributors predict an increase in the gold price for the third year in a row. Their average gold forecast is US$1,766, a 10.2% increase compared to the price in the first week of January 2012. Analysts are even more bullish about the prospects of the other precious metals, predicting a 17.3% increase in the price of silver and 15% and 12.3% rise in the prices of platinum and palladium respectively.

However, if we compare the average 2012 forecasts with actual average prices in 2011, we can see that analysts are less bullish about the prospects for precious metals during the next 12 months. Whilst analysts predict a similar rise in the price of gold (12.3%) and for the price of palladium to remain broadly unchanged (0.3%), they are forecasting a fall in the price of both silver (-3.2%) and platinum (-5.6%).

Looking back on the results of the 2011 forecast, the average forecasts by analysts were met with mixed success. Although they correctly predicted the upward price direction for both gold and silver, actual average prices in 2011 outturned $115 and $5 higher respectively than they had forecast. Analysts had also predicted an upward price movement for both platinum and palladium but average prices in 2011 outturned lower than they had forecast (by 5.4% and 11% respectively), with both metals actually recording a fall in price during the year compared with average prices in the first week of 2011.

The full survey, including specially written commentaries together with analysis of the historical performance of the Forecast, will be published later this month and posted on the LBMA website in mid-January.

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