Gold sure is burning bright, price-wise. Analysts are now recasting their projections on how soon gold will get to $2,500 an ounce - and even $2,600. Image Credit: Bloomberg

Dubai: Gold shoppers in the UAE and elsewhere are confronting a new possibility – prices could well take a shot at zooming towards $2,600 an ounce soon enough.

This morning (May 20), bullion is trading at $2,438, continuing from where it left off last Friday, when it shot past $2,400 again. So far this morning, gold is up nearly $20.

As for the UAE gold rate, it is currently at its new all-time high for 22K, at Dh273.25 a gram. That for 24K is 292.5 and Dh262 for 21K and Dh224.75 for 18K. (UAE gold rate was Dh270.75 for 22K when market closed Friday last.)

Read More

“Until last year, anything over Dh200 a gram for 22K was deemed as expensive by UAE gold shoppers,” said a jeweler. “Now, Dh200 is considered as ‘cheap’ for anyone considering a purchase. That’s how things have changed in the last 4 months.”

In the morning trade, bullion even hit a new high in the commodity markets, of $2,450 an ounce. Currently, the price has eased a bit, to $2,435 levels. But shoppers and traders can expect some high-voltage movements in the days ahead.

Can this surge take gold to $2,600?

Analysts are now saying that a more realistic upper limit to the latest spike would be somewhere between $2,500-$2,600. "No longer is $2,500 looking like a stretch target," said Vijay Valecha, Chief Investment Officer at Century Financial.

"Given the current geopolitical situation, the sentiment towards gold seems to be getting more and more bullish (along with other metals). We can expect even more highs - on gold and silver - in the coming weeks."

Valecha maintains that hitting the $2,600 'should be very soon' and that 'I can see it go all the way till $3,000 this year itself."