While analysts and traders from New York to London bet that gold will go higher, veteran investor Jim Rogers would rather seek haven in the dollar as the U.K.’s vote to leave the European Union roils global markets.
Prices of bullion are due for a drop and will probably be lower at the end of the year versus current levels, Rogers said in a phone interview on Monday, adding that he would buy the metal again once it declines enough. That view is at odds with the median of 12 forecasts in a Bloomberg survey that predicts a gain of more than 7 percent for gold from where it’s trading now.
Gold is being boosted by its role as a refuge, with prices on Friday posting the biggest increase of any major global asset as the world grappled with the economic impact of the U.K.’s exit from the EU.
The rally added to what’s already been a stellar 2016 for bullion, with prices up 25 percent after three years of losses. Hedge funds have boosted their bets on gains in the metal to an all-time high. This enthusiasm is what is making Rogers wary.
“Gold has been staggering this year, went straight up, and I don’t like to buy anything that’s run straight up,” Rogers said. “I would prefer to buy the dollar as a haven than gold.” Bullion for immediate delivery rose 0.8 percent to $1,325.82 an ounce at 11:01 a.m. in London, according to Bloomberg generic pricing.
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