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gold @ us450, direct from diggers & dealers

  1. 2,839 Posts.
    Sorry for the double post....original should have been in the ASX General Forum.

    Morning all,
    Now here's some food for thought, gold to hit US450 within 12 months, promulgated by no less a man than the President of Newmont, Pierre Lassonde.
    This is the same hombre who 12 months ago, at the very same venue.....when gold was trading at US280, predicted that it would hit US350 within 18 months, not only were his musings correct, but reached within a 12 month time frame.
    Once again the Diggers and Dealers is the venue for such grandiose pontifications &/or pronuouncements, that, incidentally, are very dear to my heart....let's hope this latest one wasn't made late in the day, whilst under the influence of Emu Bitter.
    Cheers all and good luck to all of us who get excited every time matters, such as the D & D get together, gain front page billing.

    UPDATE 1-Newmont sees gold price at $450/oz in next 12 mths
    8/4/2003 3:18:50 AM

    My Portfolio Alerts
    Company: Newmont Mining Corporation

    KALGOORLIE, Australia, Aug 4 (Reuters) - Newmont Mining Corp (NEM) , the world's largest gold miner, said on Monday it expects gold prices to rise by $100 to reach $450 an ounce over the next 12 months due to a depreciation in the U.S. dollar.

    "Our view is that gold will go up to $450 in the next 12 months," Newmont President Pierre Lassonde told a briefing at a mining conference in Australia.

    Gold last traded that high in 1988.

    Lassonde, who last year accurately predicted a gold price rise to around $350 an ounce, said he expected a further depreciation in the U.S. dollar as financial markets became concerned at the ballooning U.S. trade deficit.

    Gold was trading at $348.90/9.60 late on Monday, compared with $308 a year ago.

    Lassonde also said 80 percent of variations in bullion prices could be directly linked to the value of the U.S. dollar. Many currencies have appreciated sharply against the U.S. dollar over the past 18 months as investors became concerned at softness in the U.S. economy.

    An industry trend to abandon gold hedges -- fixed price gold sales -- in the last year was also helping increase bullion prices, as was self-discipline by central banks when releasing caches of the precious metal on the market, Lassonde said.

    A renewal of the so-called Washington Agreement of September 1999, whereby Europe's largest central banks agreed to limit bullion sales to 400 tonnes a year in total for five years, was no longer needed, he said.

    The banks, which analysts estimate hold up to 50,000 tonnes of gold in their vaults, enough to satisfy world demand for more than a decade, "were no longer unconditional sellers," Lassonde said.

    Newmont, with a market capitalisation of $14 billion, was crowned the world's largest gold miner after acquiring Australia's Normandy Mining last year, enabling it to mine nearly eight million ounces a year.

    It immediately vowed to unwind some 10 million ounces of gold hedges held by Normandy, an effort which would be completed next month, Lassonde said.

    Industry wide, gold hedges have fallen to around 2,400 tonnes of gold from 4,000 tonnes 18 months ago, he said.

    Lassonde also said exploration ground in the West African nation of Ghana, a lowly-regarded Normandy asset at the time of the acquisition, was turning into the jewel of the purchase.

    The properties could eventually yield up to 700,000 ounces of gold a year, Lassonde said, adding that the company would release more information on the lodes in September. ($1=A$1.54)

    © Reuters 2003. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of the Reuters group of companies around the world.

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