Decision by Switzerland on the ankle of the ancient sanctuary of the franc to the euro eventually can fail golden opportunity to see the prices reached U.S. $ 2,000 an ounce once unthinkable, the metal that holds the clue to its strongest annual meeting in three decades.
The Swiss National Bank shocked world markets on Tuesday as saying he was going to buy an unlimited amount of foreign currency to prevent the franc more than 1.20 Swiss francs per euro, as it struggles to contain the meteoric rise of its currency threatens exports and the economy.
By buying euros in unlimited quantities to weaken the franc, the SNB is made to put more of their own money in circulation, threatening to trigger inflation.
It also affected the status of the Swiss currency as a haven of peace in their own right. First gold prices fell as the movement has provoked a flood of liquidity in the form of other currencies like the dollar, the Swiss National Bank on the move is likely to provide strong support to gold in the medium term, say analysts.
"In general, Switzerland is now a policy of quantitative easing in the currency markets," said Peter Fertig, a consultant for research in the amount of commodities. "If the Swiss franc is no longer a safe haven of choice because of the intervention of the negotiating committee, will be (positive) demand for gold."
Gold increased a lot this year - currently 34 percent since January, on track for its biggest gain since 1979 - was fueled by cheap money, provided mainly by Western central banks to combat debt pile large enough to derail global growth.
Even without the SNB, the worsening debt crisis in the euro area and the inability of the U.S. economy to create a single job last month had led many analysts to improve its gold price targets this year.
The mark of $ 2000 has come in clear view - even if their survival at this level is unclear.
"$ 2000 is a number. There is no reason why he can not go through it, you can go a long way through this," said Nic Brown strategist at Natixis.
"This explosion generates a liquidity demand for gold and creates the perception of the price of gold to go higher," he said. "But ultimately, this is a bubble fueled by cash."
Adjusted for inflation, and gold reached U.S. $ 2,000 per ounce in October 1980. In 1980, the money, the price of gold record high on Tuesday of $ 1920.30 an ounce is only $ 720.
However, the rally was impressive, however, with the metal placed at the end of September with its twelfth consecutive quarterly increase, its longest winning streak in 30 years or more. Place of Switzerland is just the latest piece of news favorable to the metal.
"I think gold is headed to $ 2,000. In theory, this could happen in a few days," said Frank McGhee, head precious metals trading brokerage services built Chicago.
"In fact, if this type of intervention actions was taken and was considered the effective time, then the market will have a new strength from that."
Last refuge?
Gold is part of the family of safe havens, such as senior debt, and so far, the Swiss franc, named for the tranquility they offer to investors when markets become volatile.
With the U.S. Treasury stripped of their triple-A in August by Standard & Poors, German Bund flicker as investors weigh the cost of the richest economy in the euro area to replenish their neighbors, and the Swiss franc is chained the euro, gold is considered by many as the ultimate refuge Standing Committee.
"We have seen that the U.S. Treasury has a reputation for" risk-free assets "damaged, now we have about the Swiss franc to a substantial and sustained intervention by the SNB, so yes it will strengthen demand for gold as a safe haven, "said Credit Suisse analyst Tom Kendall.
"Before this announcement, which was among those who think we should solve some of the area of $ 1,910 and was looking for a short term correction," he said.
"But I think this, and in light of continued pressure on the interbank market for European finance ... I see no real obstacle to gold move above $ 1920 that brand."
Apart from the concerns of investors about the stability of support for the U.S. dollar economy as currency, the euro, sterling or yen, the growing desire among central banks in emerging markets to diversify its foreign exchange reserves was a major supporting factor for the bullion market.
The latest International Monetary Fund shows the world's central banks, bought about 200 tons of gold this year, led by Mexico, Russia and South Korea.
Investors in exchange-traded products backed by physical gold holdings have increased by a network of 75 tonnes in 2011.
The Swiss National Bank "shock and awe" The decision could encourage more investment.
But not everyone buys into the argument of gold as a haven, with some investors, especially those with shorter time horizons, pointing to the recent volatility in the gold market as a reason to be cautious. Gold traded in a range of more than $ 300 in August, the widest spread of a month in real terms since 1980.
"Stability in a safe manner. What we see in the gold market is anything but stable," said U.S. independent investor Dennis Gartman. "Everything that moves as gold rose today - from $ 1920 all the way up to $ 1,870 over a period of five minutes - it is not safe."
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