Jewelry Industry Blog

New York—Two industry experts predicted gold prices would push past $1,100 an ounce in the coming year, fueled by a weak U.S. dollar and growing inflation fears.

GFMS Ltd. Research Director Philip Newman and Tim Dinneny, with metals trading and finance firm ScotiaMocatta, spoke on gold prices during The Plumb Club Forum, held Sunday and Monday in New York City.

George Milling-Stanley, manager of investment and market intelligence for the World Gold Council, moderated the panel.

Newman, whose company is a London-based independent precious-metals consultancy, said he expects a record level of gold investment in 2008, driven by ongoing problems in the U.S. economy.

The impact of the U.S. credit market crisis is “broad and ongoing,” he said.

Newman predicted gold would average $970 an ounce in 2008, hitting a high of $1,180 an ounce and dipping as low as $870 an ounce.

At the retail level, this could result in lighter gold pieces and a growing use of steel, silver and other materials in jewelry such as rubber, glass and wood.

Newman said all jewelry, including gold jewelry, faces increasing competition from products such as Apple’s iPod, cell phones, the travel and leisure sector, and heavily branded, high-priced clothing items such as handbags.

Dinneny said “the market is moving faster than we expected,” and predicted gold prices soon would hit $1,000 an ounce and would peak at $1,200 an ounce this year.