BofA Merrill Lynch cuts 2014 gold forecast by 17% to $1,294

Thanks;The outlook for gold GCZ3 1.01% in 2014 is looking positively dicey if you go by the views of several investment banks lately.

Bank of America Merrill Lynch on Friday became the latest investment bank to drop its 2014 forecast for gold, cutting its view by 17.2% to $1,294 an ounce.

“Gold prices have stabilized and they could remain supported as the U.S. reaches the debt ceiling. However, we believe the focus of investors remains firmly on a gradual normalization of U.S. monetary policy. Hence, our base case anticipates sustained headwinds to gold prices,” says Daniel Lian and other analysts in a note.
“Given the unfolding rebound of global economic growth, we believe the more cyclical precious metals, including silver, are likely to outperform gold.”
Lian says Merrill remains a longer-term gold bull, even if it’s short-term skittish. But for 2015, Merrill’s gold forecast dropped 17.8% to $1,356. This year, Merrill sees gold ending at $1,419, a 4% drop from its earlier forecast.