RBI's curbing imports will prompt more gold buying: Barratt

Global gold prices may head to USD 1,370-1,380 to 1,420 per ounce if it manages to hold crucial levels of USD 1,330-1,334 per ounce,  Jonathan Barratt, CEO, barrattsbulletin.com told CNBC-TV18.

According to him, Reserve Bank of India's (RBI) latest move to put further curbs on gold import needs to be reviewed as it will force investors to return to the yellow metal since it will hit supply. Below is the verbatim transcript of Jonathan Barratt’s interview on CNBC-TV18 Q: With gold now at past USD 1,330 per ounce levels, what are the next levels that you see in the medium-term here? A: It has been quite a move for gold just over the last week or so. I think the USD 1,330-1,334 per ounce has been a crucial level because that was the breakdown level we saw. So if the market can hold on to these levels, I would look forward to USD 1,370-1,380 to 1,420 per ounce. Q: This morning, we woke up to Reserve Bank of India (RBI) putting curbs on further import of gold in order to sort of rein in the current account deficit (CAD). What do you think this could do to gold prices in the Indian market itself? A: I do not think it has caused much of a concern, this physical buying. I think the important thing is that it is an asset to try and curb demand that when you look at it, I don’t think it is too much of a fate. People feel that the value in gold is certainly at these levels and as a result I think you are finding more of a squeeze as people continue to like that metal for obvious reasons. So it is a policy that has to be reviewed because at the end of the day it is only going to force people to come back to the metal because it will be in a less supply. So I think it is a bit of a problem and it needs to be reviewed. Q: Give us a word on other commodities like silver etc because while we are seeing this kind of a surge in gold and perhaps for a variety of reasons, silver is still just about managing to hold on to levels of USD 20 per ounce, what is the outlook on that? A: Silver itself has always been a metal that hasn’t moved with gold and it is quite a shame because silver does represent a good store of value similar to gold and also has its industrial uses. So I would like to see more of a kick on silver over gold. If gold does have a continued move, then I think it will drag up silver. But the whole complex is looking a good value at the moment.