Bloomberg Survey Indicates Bullishness

A Bloomberg survey of fifteen traders, investors and analysts revealed that eleven of them think gold will go higher next week. Three were bearish and one was neutral. The main reason for the bulls' bullishness was expectation of further inflation.

Consumer costs in the U.S. gained for a seventh straight month in January and the U.K. consumer price index rose to a 26- month high. Oil traded near the highest in two years, cotton topped $2 a pound for the first time ever and copper rose to a record this week.

“Rising commodity prices are the symptoms of a dollar debasement strategy and in no way can bring down the rate of inflation,” said Michael Pento, a senior economist at Euro Pacific Capital in New York.

The survey's long-term track record is significantly above random, but not by very much: 60% accuracy.