(MENAFN - Gulf Times) Customers shopping for jewellery at a store in the gold souk in Dubai. Gold prices will fall below 1,500 an ounce over the next three months and are unlikely to retest September's all-time highs until later 2012 at the earliest, according to a Reuters poll of 20 hedge fund managers, economists and traders.
The bleak forecast, coming after gold has lost 11% of its value so far this month, is likely to fuel fears that bullion is close to ending its more than decade long bull run and entering a bear market.
Almost half of respondents predicted bullion will fall to 1,450 an ounce in the first quarter next year, with three seeing prices as low as 1,400 an ounce. The forecasts come after a dismal performance last week when prices hit a 2 month low of 1,560 and gold lost its safe haven status. Selling was fuelled by a scramble by hedge funds for cash to meet client redemptions at the end of a difficult year and a run for cash by European banks seeking to raise capital.
"What is surprising is that in an environment where headline risk news is bigger than ever, gold has actually fallen from its highs," said Christoph Eibl, CEO and founding partner of the Swiss commodity hedge fund Tiberius. "We believe that, in 2012, of all metals gold will be the worst performing," Eibl said.