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Current gold price too costly - Peter Major, Cadiz In an interview on Radio 2000 @ 18:15 on Wednesday 19 September 2007 [miningmx.com] -- THE current gold price driven higher by a weakening dollar and interest rate cut in the United States is too expensive and will be unsustainable, said Peter Major from Cadiz African Harvest. "The dollar has had a big run and I don't see why it should lose much more than it already has," Major said on the Moneyweb Power Hour week-nightly radio show. Major's comments come after gold pushed to a high of $726 an ounce on 19 September, its best level since May 2006 and just four dollars shy of its 26-year high of $730 high it reached in that month. The dollar depreciated after the US interest rate cut. South African gold shares across the board were higher, with the sector last up 2.2%, slightly behind the overall market's three percent rise. Meanwhile, gold mining companies had turned in a disappointing performance in the gold bull run over the past year. "There's too much risk associated with mining companies. There are political risks, management risks... and there is also the cost issue, and, compared to gold-backed ETFs (exchange-traded funds), mining companies are really disappointing," Major said. Commenting on DRDGOLD'S decision to sell its Emperor assets, Major said this was good news. "They are getting rid of one bad leg. It's very positive for the company," he said Major. On 18 September, DRDGOLD said that it had been guaranteed a minimum return of A$54m (R324m) in cash on the proposed sale of its 78.7% stake in Emperor Mines, an Australian-listed firm that is to merge with Intrepid Mines.
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