Gold price to average $1,140: Barclays Capital

La Salle Futures Group trader Matt Zeman says positive sentiment about further gold price rises is gathering pace.

The yellow metal is renowned for its negative correlation with the dollar but still hit a record $1,153 per ounce yesterday, despite the greenback increasing by 0.8 percent against the euro.

Mr. Zeman, from the Chicago-based brokerage firm, explained that investors are not being fooled by any short-term gains in the US currency and can see a bright future for gold.

"No one has faith in a sustained dollar rally," he told the news provider.

"Gold just seems resilient in the face of a stronger dollar. This is a big bullish signal. People want gold to go higher."

A similar view was outlined last week by Suki Cooper, a precious metals analyst at Barclays Capital, which is one of the world's leading investment banks.

In an interview with the Daily Telegraph, she predicted that Gold Prices should continue to perform strongly for a minimum of seven months.

"We expect prices to maintain their upward momentum through to at least the first half of 2010, where we expect prices to average $1,140 in the second quarter," she told the newspaper.

"The unexpected purchase of [200 tonnes of] gold by the Reserve Bank of India has only added to the positive sentiment towards gold."

Courtesy: bullionvault.com