Thursday, September 16, 2010

Citigroup (NYSE:C): $1,300 Gold within Week

If the Federal Reserve announces they're going to resume quantitative easing, Citigroup (NYSE:C) says gold prices could reach as high as $1,300 within a week.

Citigroup analyst David Thurtell said, "If the Fed says next week it is going to do more quantitative easing ... the inflation bugs will have a field day."

That's actually a real possibility, as gold prices have strong support, and the market is looking closely at inflation, government stimulus and central banks to print money again.

These are all coming together, as inflation was reported as higher today, with the core Producer Price Index in the U.S. increasing 0.4 percent in August.

Add to that the expected stimulus and resumption of quantitative easing, and it can't get any better than that as far as something that will drive the price of gold to extreme levels.

If quantitative easing is in fact announced and implemented, gold prices will immediately skyrocket on the news, and it's unknown how high it will go after that, as the perfect storm again is influencing the gold market.

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