More gold buying seen ahead as equities jittery: Swiss Asia

Juerg Kiener, managing director and chief investment officer, Swiss Asia Capitals is bullish on gold's long-term prospects as investors are likely to pull out money from equities market and allocate in gold.

Kiener's views come on the back of spot gold price falling to two-month lows at USD 1,328.75 an ounce by 0709 GMT, down more than 4 percent for the week.

However, Kiener says the precious metal is likely to be under pressure in the short-term. "The long-term support is quite well because as the financial market destabilised, there is more money flow going to precious metals," adds Kiener. Below is the edited transcript of Kiener’s interview to CNBC-TV18. Q: We saw a very sharp cut in gold over the last two days and now come to levels of about USD 1350 per ounce, where do you see it headed in light of the developments that we have seen from the Fed? A: If one looks at the global picture of tampering of QE or not, I do not think we are going to be able to take the stimulus away otherwise the house of cards is coming down quite sharply. So, we are going to continue to look at about the trillion dollars of spending and support basically of the system atleast in United States and that requires just to keep the status quo. There is no growth, nothing at all, it is just basically sideways move with high volatility. The reason why we have huge volatility right now is the activity, which we had in Japan where the Value at Risk (VAR) models are basically killing everybody and that is what we see as well in commodity markets where VARs and on the mining side, the share side the VARs are basically forcing liquidations through the margin calls. So, in short-term we might get a bit of a pressure in some of the elements but the long-term support is quite well because as the financial market destabilised, there is more money flow going to precious metals.