MOSCOW, November 30 (RIA Novosti) - The unprecedented growth in the gold price has been caused by the high oil price, and the unstable forex market, experts with Russian investment companies said Wednesday.
The gold price has been setting records on world markets during 2005. On November 29, gold cost $502.3 per troy ounce, the highest price for 18 years.
According to the experts, gold remains the only reliable asset against a backdrop of high oil prices, and instability on the forex market. Oil prices are the main factor influencing gold price movements.
Vladimir Abramov, an analyst with Globex Bank, said gold was the only reliable instrument in which to invest petrodollars. "Therefore, the market focuses on gold."
Yevgeny Shago, an expert with the Region Group, agreed that gold had become "an alternative, reliable and liquid asset" since the euro's slide against the dollar.
If the European Central Bank increases the discount rate, the gold price could stop growing and could even fall by 5%, he added.
According to Abramov, gold prices would vary from $480-520 per troy ounce by the end of 2005.
The experts also said plans of developing countries to increase the share of gold in their central bank reserves could also influence the market.
Shago said the amount of gold mined had little influence on its price. He added that some 2,500-2,700 tons of gold are annually produced in the world, including 180-190 tons in Russia, which takes fifth place among gold mining countries.
Pavel Polukhin, an analyst with Olma investment group, said demand for gold on Asian markets also boosted the gold price.
