The Gold Price – what will it do this year?

Experts are predicting the price of gold will climb during 2012 following the decision by the US to hold interest rates until late 2014.

Evy Hambro, the manager of the £2.9 billion BlackRock Gold & General fund, says there will be new central bank buyers this year. According to the International Monetary Fund, central banks bought nearly 3,500 tonnes of gold in the first 11 months of last year - the largest amount for years.

He predicts the price of gold will see a gradual trend upwards during 2012. We will continue to see a strong demand in China for jewellery. Investor demand will rise due to the US debt levels, the presidential elections and the events in Europe. The role of gold in an investment portfolio as a diversification tool will be further enhanced over the coming months.