Gold could test new highs this year

Gold last traded at $1,908 an ounce. Silver at $28.18 an ounce.

NEWS SUMMARY: Precious metal prices rose Wednesday on safe-haven buying despite a firmer dollar. U.S. stocks hovered near an all-time high, following a muted start to June.

CNBC

"Gold could test new highs again this year, according to David Lennox of Fat Prophets, who said he sees 'a fairly big tick' ahead for prices of the precious metal....Higher readings of inflation are set to be a 'boon' for gold, a physical asset, Lennox said.

'Inflation's coming back because we’ve seen such a significant surge in U.S. money supply,' he explained. 'Whenever we've seen that surge in the past, it’s been accompanied — probably five of six months later — by higher inflation.'....

Meanwhile, the dollar is also expected to weaken, and could be another potential tailwind for gold — considered a safe investment asset in times of market uncertainty.

'We’ve got rising debt, we've got more physical money inside ... the U.S. dollar pool,' Lennox said. 'Those two factors in themselves would suggest that we’re going to see a weaker U.S. dollar going forward.'

Furthermore, the economies of major currencies that trade against the U.S. dollar are in some instances doing better than the U.S., he said without elaborating.

'We think there's further (dollar weakness) to go and that’s going to be a very good tailwind for the gold price and precious metals,' said Lennox."