The precious metal topped out at a 3-month high of $931 on safe-haven
demand last Friday and then fell to $821 Monday as world central banks
announced plans to recharge the banking sector. Strategists at Merrill
Lynch say, in the big picture, gold should hold its safe-haven status
overall, with future liquidity crises still likely. "Flight to safety"
demand could send gold up to $1000 in the months to come, the
strategists say. Renewed dollar weakness, if it occurs at the same
time, could be a contributing factor that underpins gold further -
towards $1200, they say. A new run-up in commodities would add another
element. The current global bank bailout, seen as inflationary, could
mean higher oil prices again ($150/bl). If gold maintains its long-run
relationship with other commodities, "gold prices could well press
higher to $1500," Merrill Lynch says.