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2012 LBMA Gold Price Forecasts

Each year LBMA members forecast precious metal prices including gold for the next year. For several years now, Ross Norman of The Bullion Desk in London has been one of the most bullish and most accurate forecasters.
The "official" forecasts are usually published in early January each year. As we created this page in October, we noticed that an electronic poll had been conducted by the LBMA at its annual conference.

Montreal (Kitco News)
20th September 2011
– Delegates attending the London Bullion Market Association's annual conference in Montreal this week look for gold to be above $2,000 an ounce when the group holds its next annual gathering in November 2012.
The LBMA polled the audience using an electronic system both at the end and start of the two-day event. Of the 530 delegates who voted, the average expectation as of Monday morning was $2,075 gold by Nov. 5, 2012. A second vote was taken early Tuesday afternoon as the conference wound down, and this time the average tally was $2,019.
Shortly after the votes were announced, gold was trading at $1,803.50 an ounce, according to prices on the Kitco Web site.
The delegates included representatives of banks and the trading community, as well as refiners, fabricators, some mining companies and others involved with the precious-metals industry.
The gathering collectively looked for all of the precious metals to be higher in a year. The end-of-conference vote showed an average expectation for silver to be $47 an ounce in November 2012. The metal was trading around $39.90 Tuesday afternoon.
Platinum was forecast to be at $2,163 around the time of the next LBMA conference, up from $1,771 Tuesday afternoon. Palladium was forecast at $826, compared to $714 Tuesday afternoon.
During the conference, conducted a poll of readers, who tended to be even more bullish for the metals. With around 1,100 responses, this poll put gold at $2,250 an ounce, silver at $67.57, platinum at $2,152 and palladium at $1,025.
At the end of the closing LBMA session, delegates were split when asked their view on some of the topics that have the potential to impact precious-metals prices in the future. Fifty-one percent see a weaker U.S. dollar when the next LBMA conference rolls around, while 49% said stronger. They were evenly split at 50%-50% when asked whether the European debt crisis would be better or worse by the next conference.
At the end of the 2010 LBMA conference in Berlin, delegates collectively forecast that gold would be at $1,450 an ounce when the 2011 event began Monday. Other forecasts made a year ago included silver, $24; platinum, $1,857; and palladium, $702.
By Allen Sykora of Kitco News

2012 LBMA Gold Price Forecasts in US Dollars

Rohit Savant - CPM Group$1,800$1,200$1,612$600
Eddie Nagao - Sumitomo Corporation$1,800$1,300$1,525$500
Bhargava Vaidya - B.N. Vaidya & Associates$1,900$1,440$1,600$460
Thorsten Proettel - LBBW$1,950$1,220$1,640$730
Bayram Dincer - LGT Capital Management$1,950$1,450$1,770$500
Tom Kendall - Credit Suisse Securities (Europe) Ltd$1,960$1,475$1,755$485
Jeffrey Rhodes -INTL Commodities$1,975$1,465$1,727$510
Rene Hochreiter - Allan Hochreiter (Pty) Ltd$2,000$1,450$1,650$550
Philip Klapwijk - Thomson Reuters GFMS$2,005$1,530$1,760$475
Wolfgang Wrzesniok- Rossbach - Degussa Goldhandel GmbH$2,010$1,425$1,750$585
Carl Firman - VM Group$2,012$1,410$1,689$602
James Steel - HSBC$2,050$1,450$1,850$600
David Jollie - Mitsui & Co Precious Metals Inc$2,075$1,480$1,770$595
Daniel Smith - Standard Chartered Bank$2,075$1,525$1,875$550
Matthew Turner - Mitsubishi Corporation International (Europe) Plc$2,100$1,425$1,782$675
Anne-Laure Tremblay - BNP Paribas$2,100$1,500$1,775$600
Daniel Brebner - Deutsche Bank$2,100$1,545$1,825$555
Ross Norman - Sharps Pixley Ltd$2,100$1,590$1,765$510
Frederic Panizzutti - MKS Finance S.A.$2,120$1,550$1,808$570
Martin Murenbeeld - DundeeWealth$2,125$1,450$1,835$675
Peter Fertig - QCR Quantitive Commodity Research Ltd$2,150$1,390$1,730$760
Michael Jansen - JPMorgan Securities$2,150$1,450$1,869$700
Suki Cooper - Barclays Capital$2,200$1,400$1,875$800
William Adams - Fastmarkets$2,230$1,500$1,785$730
Edel Tully - UBS$2,500$1,400$2,050$1,100

Other Forecasts & Comments

  • Bank of America Merrill Lynch on Wednesday maintained its 12-month gold price target of $2,000 per ounce on continuing debt issues.
    (6th October 2011).

  • Gold: how low can it go? by Max Julius on Sep 28, 2011 at 00:01
    In a note titled ‘USD – the only port in this storm’, strategists at HSBC pointed out that the flight to the dollar took place even though there had been no improvement in the structural position in the US. ‘The only reason that the dollar has benefited is that no alternative safe haven exists,’ they wrote.
    And Yuen Low, mining analyst at Shore Capital, stressed the significance of the figures from China for investor sentiment. ‘If the Chinese data had been good, I think gold would have gone up,’ he said.
    He continued: ‘Looking at the way everything has been sold off, not just gold but shares and oil companies, my feeling is that this is really an indiscriminate sell-off.’
    Gold’s outlook
    Low said he expected gold to pick up again in the short term, adding that whether it breaches the $2,000 an ounce mark ‘really depends on what happens with the European debt situation, with the US economy and with the Chinese economy’.
    JP Morgan’s Gregson, for his part, also said gold was likely to rally. He branded demand for the metal as ‘a sort of battle between two camps of gold buyers’, saying as ETF investors pulled back the falls had generated ‘further strong physical buying out of Asia’, while the physical market in Europe for gold coins was still strong.
    ‘At the moment I don’t really see what competes with gold in terms of worries that investors have about the world,’ he said. ‘We’re still going to have very low US interest rates, we’re still going to have developed world economies that aren’t in great shape; and, therefore, why would you want to own their currencies?’
    Gregson, who works with Ian Henderson on his JP Morgan Natural Resources fund, a Citywire Selection pick, continued: ‘I think as a currency, gold remains supported, and as a risk hedge and a fear hedge, gold will continue to generate some appetite.

Our Forecast?

We will guess at $2,250 maximum, $1,990 average, and $1,500 minimum.
We may revise these figures by the start of 2012.

Longer Term

With much evidence of competitive devaluation and quantitative easing worldwide, we believe that gold has much higher to go. Some goldbugs have been talking about $8,500 per ounce, but we regard this type of forecast as being from the lunatic fringe, even though some of the pundits have advanced convincing arguments to back their opinions.
If confidence in the U.S. dollar ever crashes, or perhaps when it crashes, then every forecast may prove to be too low,
There are still uncertainties and fears about the debts of a number of western countries, and some sovereign credit ratings now stand at junk or near junk. Failure, or near total collapse, of one or more major currencies cannot be ruled out. We remain unconvinced that the dollar will hold its value or purchasing power. Attempts by central banks to gently weaken their currencies can, and have, gone wrong and got out of hand. It will happen again, and it could happen to the mighty dollar, which is does not have guaranteed immunity.


Last year, out of the 24 individual forecasts, 22 had been surpassed as at 2nd December. Almost incredibly, the lowest "high" forecast was actually less than the year's all time low! The "average of all the forecasts has been bettered by 10%.
Of the 26 forecasters, for once Ross Norman's is not the most bullish, at 18th, with 7 predicting higher maxima. Will he be the closest yet again?

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