Barclays cuts gold price forecast

In lunchtime trade on Wednesday on the Comex division of the New York Mercantile Exchange gold for December delivery was changing hands for $1,236.20 an ounce, not for off 8-months lows hit last week.

After reaching a high of $1,380 in March, gold's retreat accelerated during the third quarter with a loss of 4% so far in September alone. Gains since the start of the year are now just 2.5%.

Most analysts foresee a steady erosion in the price of the metal for the rest of the year and into 2015.

MarketWatch reports analysts at investment bank Barclays, on Wednesday added to the bear chorus cutting their outlook due to an "increasingly bearish macro backdrop developing" on the gold market:

"Rising rates and a significantly stronger dollar present headwinds, which are set to overwhelm any seasonal strength in physical demand this year," said a team led by Suki Cooper.

With that, Barclays cut its fourth-quarter 2014 quarterly average forecast for gold to $1,220 an ounce and its average 2014 price to $1,270 an ounce. For 2015, the analysts see price risk skewed to the downside, with average prices set to reach only $1,180 an ounce. Their silver forecast for 2015 remains unchanged at $17 an ounce, amid expectations for further downside pressure.

Image of gold bear by The Scott