NEW YORK (AP) -- A Goldman Sachs analyst cut his forecast for gold prices, saying that it's likely that they will continue to fall as the U.S. economy improves, adding to the worries already surrounding gold miner stocks.
Damien Courvalin noted that gold prices have tumbled over the past two weeks, dropping about 13 percent. Among other things, the move reflects better-than-expected U.S. economic data and less economic risk related to the U.S. and Europe, he said.
Gold prices soared following the recession and peaked in 2011. The metal's price often moves in the opposition direction of economic news as investors tend to flock to gold as a haven during times of economic uncertainty. While prices were nearly $1,900 an ounce in the fall of 2011, they hovered around $1,614 on Tuesday.
Shares of many gold mining companies have also tumbled in recent weeks, with investors fretting that the lower gold prices will cut into the companies' profits. Barrick Gold Corp., Newmont Mining Corp., AngloGold Ashanti Ltd. and Gold Fields Ltd. all hit 52-week lows in the past week.
Courvalin said that while the recent gold selloff may have been "excessive," he expects exchange traded fund gold holdings to continue to decline this year and lowered his three-, six- and 12-month gold price predictions.
But the analyst noted that the forecast remains above current gold prices, citing expectations of weak and lower-than-expected economic growth in the first half of this year.
Shares of several gold mining companies posted slight gains on Tuesday, helped by an uptick in gold prices.
In afternoon trading, Goldcorp rose 72 cents, or 2 percent, to $33.50; Barrick added 65 cents, or 2 percent, to $32.44; Newmont rose 43 cents to $41.39; AngloGold added 30 cents to $25.74; and Gold Fields rose 16 cents to $8.94.