CHENNAI: The uncertainty caused by the US debt crisis has put rocket boosters on gold prices. The coveted yellow metal is expected to break the Rs 3,000/gm barrier pretty soon, say experts.The predictions made by industry front-runners in Chennai based on a forecast by the Bank of America seem like a joke. Earlier, the financial services giant had said gold prices would touch $2,000 an ounce (`3,190/gm) in 12 months.But, Lalitha Jewellery Mart MD Kiran Kumar insists otherwise, “When I say it will reach `3,000/gm by September, I am only making an attempt to be modest. Prices are shooting up.” Despite rising prices, there has been no slip in demand. In fact, claims Kiran, the demand will only continue to grow. “No matter how high the prices rise, gold is always a very stable investment. In the current scenario, people are not confident of investing in stock markets. Real estate prices are also either unstable or falling. So, the only option is gold,” he says.The current rise in prices are typical of disasters and calamities, says Shivram Kumar, director, World Gold Council (WGC), India. “The gold market is bullish at present. It has been so for the last two or three years,” he cautions.The WGC prevents its officials from making predictions on prices, as it is an industry body. But Kumar sums up his analysis of the mad rush as: “Gold is the safe haven of investments. It helps shield against inflation and is highly fluid. Gold reacts to disasters and calamities around the world, as it is considered international currency. The global financial scene has not been favourable in recent years and this has caused a flight of funds from equities and other classes of investment to the safe haven.World’s Gold Giant Last year, Indians accounted for 963 tonnes of around 2,400 tonnes of gold traded worldwide. Unlike most other countries, the lion’s share of India’s gold was purchased by consumers. In the first quarter of 2011 alone, around 220 tonnes have been imported to India.
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