"We see gold averaging $1,500/oz for 2011 and peaking at an average of $1,600/oz. Low interest rates combined with higher inflation expectations mean that expected real rates of return are negative, which is supportive for gold prices, as it is for other commodities. Inflationary pressures, notably in China, boost demand for gold bars and jewelry as a hedge,” she told CNBC.com.The bedrock for those forecasts is continued easy-money policy by the Fed and a world awash in liquidity as a result of central banks combatting the '08 crisis and its aftermath.
Another analyst put the kibosh on the idea that gold is in a bubble. He acknowledged gold's ascent, but said its volatility [both downwards and upwards] is still fairly low. In bubble conditions, [primarily upward] volatility explodes.