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Market Chatter: HSBC Cuts Gold Forecast, Sees Recovery Later in 2013

"HSBC cut its gold forecast for this year and next on Monday after the metal's weak start to the year, but said ultra-loose monetary policy in the United States and elsewhere meant it remains positive on prices overall," Reuters reported.

It said: "The bank lowered its 2013 gold price forecast to $1,700 per ounce from $1,760 and the 2014 price outlook to $1,720 per ounce from $1,775. It sees the metal trading between $1,525 and $1,825 an ounce this year. Gold prices are down 4% in the year to date, primarily due to investor expectations the Federal Reserve would curb its U.S. quantitative easing program, and have fallen for the last five months straight."

"Later in 2013, we expect monetary easing, escalating currency wars, and geopolitical tensions to support gold prices up to $1,800 an ounce," the bank said in a note. "Increased inflationary expectations should buoy gold."

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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