A ‘Grexit’ will send gold to $1,400 by year’s end

20-Apr (MarketWatch) — The gold market isn’t getting much of a safe-haven boost from the turmoil in Greece right now, but that may soon change.

The risk of a Greek exit from the eurozone will help lift gold prices to $1,400 an ounce by the end of the year, according to Capital Economics.

…“The markets still appear to be anticipating some sort of last-minute deal or accounting tricks to rescue Greece,” Julian Jessop, head of commodities research at Capital Economics, wrote in a research note dated Monday. And even if Greece does default on its debt, that wouldn’t necessarily lead to an exit from the eurozone, he said.

Still, Jessop said Capital Economics is “confident” that a “further escalation of the crisis in Greece” will provide support to gold.

It would be a mistake to believe that the country is a “‘special case’ and that other members are very unlikely to follow [Greece] out of the door,” he said.

[source]

PG View: I think the upside potential could be significantly higher if contagion occurs, and the gains could come much more quickly than many seem to be expecting.