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David Morgan: Historic silver is headed for higher ground
From Reuters
Thursday, February 24, 2005
http://www.reuters.com/financeQuoteCompanyNewsArticle.jhtml?
duid=mtfh88137_2005-02-24_23-13-50_n244274_newsml
NEW YORK -- The dollar will continue to slide this year, pushing up
the price of gold, a senior executive of Newmont Mining Corp., the
world's largest gold producer, forecast on Thursday.
"We are looking at $425-$475 over the course of 2005," said Pierre
Lassonde, Newmont's president and a highly regarded observer of the
world gold markets.
He spoke as U.S. gold futures ended off from their loftiest level
since the start of 2005, pressured by profit-taking and a lower
euro. Gold for April delivery slipped 40 cents to $435.70 an ounce
on the New York Mercantile Exchange's COMEX division. Spot gold
changed hands at $433.75/4.50 an ounce, below Wednesday's New York
close at $434.25/5.00.
"The dollar's fall is far from over," Lassonde said during a
conference call with Wall Street analysts to discuss Newmont's
fourth-quarter earnings.
He was asked to give his view of the prospects for the precious
metal, which is viewed as a safe haven for investors in times of
economic uncertainty or upheaval.
"The dollar will hit bottom only when it has fallen enough to be
attractive for private capital to come back.
"So the dollar will continue to fall and gold will go up, but at 'a
measured pace,'" he said, citing U.S. Federal Reserve Chairman Alan
Greenspan's famous turn of phrase.
Lassonde said he saw gold supply flat in 2005 after a 4 percent
decline last year, with hedge fund buybacks continuing and central
banks being net buyers of gold. Jewelry demand was up 4 percent in
2004.
"I believe the trends will continue in 2005 as the world economies
continue to expand, especially in China. The U.S. and Europe will
muddle through with the gold price in the low $400 range," he said.
Newmont chairman and chief executive Wayne Murdy echoed Lassonde,
saying the was bullish on gold.
Lassonde earlier confirmed that Newmont reported record proven and
probable gold reserves of 92.4 million equity ounces for year-end
2004, based on a gold price assumption of $350 per ounce. In 2003,
it had 91.3 million equity ounces.
He said that reserve growth highlights the strength of Newmont's
exploration team, land position and proprietary technologies.
In Ghana, Newmont added 4.1 million equity ounces, increasing equity
reserves by 35 percent to 16.0 million ounces. Nevada also more than
replaced depletion, adding 3.2 million ounces and increasing
reserves to a record 33.7 million equity ounces, he said.
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