Credit Suisse: gold versus oil shows metal poised to rally

Credit Suisse released a report this week that concluded gold - which is trading at near record levels - will outperform oil as rising consumer prices drive investors to the metal as a haven asset.Credit Suisse released a report this week that concluded gold - which is trading at near record levels - will outperform oil as rising consumer prices drive investors to the metal as a haven asset.

When comparing the change in oil and gold prices since 2008, an ounce of gold bullion can buy about 15 barrels of oil now, compared to 26 barrels two years ago. Stefan Graber, an analyst at Credit Suisse, told Bloomberg he foresees gold rising in 2011, with oil holding steady.When comparing the change in oil and gold prices since 2008, an ounce of gold bullion can buy about 15 barrels of oil now, compared to 26 barrels two years ago. Stefan Graber, an analyst at Credit Suisse, told Bloomberg he foresees gold rising in 2011, with oil holding steady.

"We see potential for gold to outperform oil over the coming months," he said. "We think an ounce of gold could potentially buy a few additional barrels of oil. This assessment is based on our positive view on gold versus a neutral view on the oil market.""We see potential for gold to outperform oil over the coming months," he said. "We think an ounce of gold could potentially buy a few additional barrels of oil. This assessment is based on our positive view on gold versus a neutral view on the oil market."

Rising inflation throughout the globe could push gold higher in the coming months, according to the report. China, South Korea and other Asian nations have raised borrowing costs over the past few months as rising consumer prices threaten surging economic growth. Even with political unrest spreading throughout the Middle East and North Africa, "oil markets are now pricing in a considerable risk premium," Graber asserted.Rising inflation throughout the globe could push gold higher in the coming months, according to the report. China, South Korea and other Asian nations have raised borrowing costs over the past few months as rising consumer prices threaten surging economic growth. Even with political unrest spreading throughout the Middle East and North Africa, "oil markets are now pricing in a considerable risk premium," Graber asserted.

Gold for immediate delivery has declined 1.6 percent since the beginning of this year after rising 30 percent in 2010. Crude oil in New York has jumped 4.7 percent this year; crude oil climbed 15 percent in 2010 as a global economic recovery took hold.  Gold for immediate delivery has declined 1.6 percent since the beginning of this year after rising 30 percent in 2010. Crude oil in New York has jumped 4.7 percent this year; crude oil climbed 15 percent in 2010 as a global economic recovery took hold.