Gold May Rebound on Demand for Inflation Hedge, Survey Says

By Pham-Duy Nguyen

Feb. 9 (Bloomberg) -- Gold may rebound this week on speculation that government spending to revive the U.S. economy will spark inflation, boosting the metal’s appeal as a hedge against accelerating prices.

Twenty of 27 traders, investors and analysts surveyed from Tokyo to Chicago on Feb. 5 and Feb. 6 advised buying gold, which fell 1.5 percent last week to $914.30 an ounce in New York. Five survey respondents said to sell, and two were neutral.

The U.S. Senate was weighing a stimulus package that exceeded $900 billion on Feb. 6. Investment in the SPDR Gold Trust, the biggest exchange-traded fund backed by bullion, reached a record 867.2 metric tons on Feb. 5.

Gold’s decline last week surprised most traders surveyed on Jan. 29 and Jan. 30. The survey has forecast prices accurately in 147 of 248 weeks, or 59 percent of the time.

Last week’s survey results: Bullish: 20 Bearish: 5 Neutral: 2

To contact the reporter on this story: Pham-Duy Nguyen in Seattle at pnguyen@bloomberg.net.