Gold to crest $1,600, says mining CEO

Prices will continue to move up in steps and ultimately top $2,000 per ounce, believes the CEO of Agnico-Eagle Mines.

By TheStreet Staff Mar 1, 2011 4:00PM

Gold © Comstock Images/JupiterimagesthestreetBy Alix Steel, TheStreet


Updated at 4:44 p.m. ET


Gold prices could break the $1,600 an ounce mark this year according to Sean Boyd, chief executive officer of Agnico-Eagle Mines (AEM).


Boyd is among the many mining executives attending the attending the 20th BMO Capital Markets Global Metals & Mining Conference in Florida this week, and believes "gold will ultimately go above $2,000.”


“I think it’s going to go in steps, so I could see $1,600 this year, which means $40 to $45 silver," Boyd told TheStreet.


Gold for April delivery surged Tuesday, rising $21.30 to settle at $1,431.20 an ounce at the Comex division of the New York Mercantile Exchange. Gold traded as high as $1,431.50 and as low as $1,409.80 during Tuesday's session.


Gold prices also got a boost from rising oil prices and comments from Fed Chairman Ben Bernanke about inflation and the impact of rising commodity costs. In his semi-annual monetary policy report to the Senate Banking Committee, Bernanke reiterated his expectations for modest inflation in the near-term and hastened to assure that the central bank was keeping a close eye on commodity prices.

"The most likely outcome is that the recent rise in commodity prices will lead to, at most, a temporary and relatively modest increase in U.S. consumer price inflation -- an outlook consistent with the projections of both FOMC participants and most private forecasters," Bernanke said in a statement. "That said, sustained rises in the prices of oil or other commodities would represent a threat both to economic growth and to overall price stability, particularly if they were to cause inflation expectations to become less well anchored."


Stocks took a tumble as rising oil prices and Bernanke’s words worried investors. The Dow Jones Industrial Average ($INDU) dropped 168 points, or 1.4%, to 12,058. The S&P 500 ($INX) fell 21 points, or 1.6%, to 1,306, and the Nasdaq ($COMPX) lost 45 points, or 1.6%, to close at 2,737.


Gold mining stocks, a risky but sometimes more profitable way to invest in gold, rallied with the metal even as broader equities sank. Newmont Mining (NEM) closed up 1.5% at $56.09, Barrick Gold (ABX) climbed 1.8% to $53.77 and Angico-Eagle gained 2.5% to finish at $72.08.

Silver prices continued to soar as well, rising 61 cents, or 1.8%, to settle at $34.43. Among silver stocks, Silver Wheaton (SLW) rose 2.4% to $43.58 and Silver Standard Resources (SSRI) rallied 3.8% to $28.17.


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Mar 2, 2011 7:21PM

Can not afford gold, so will invest in FOOD , lead, and gunpowder.

Mar 1, 2011 9:59PM
Couldn't afford gold at $200 an ounce and still can't afford it.  Also, you can't eat gole,either
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[BRIEFING.COM] The major averages ended the midweek session with slim gains after showing some intraday volatility in reaction to the release of the latest policy directive from the Federal Open Market Committee. The S&P 500 added 0.1%, while the relative strength among small caps sent the Russell 2000 higher by 0.3%.

Equities spent the first half of the session near their flat lines as participants stuck to the sidelines ahead of the FOMC statement, which conveyed no changes to the ... More


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