This year gold is expected to peak at just over $1900 per ounce with an average price gold of $1730 per ounce. Expectations are down from what many had predicted for this year, however, these prices are still historically high. It is now thought gold will finally break the $2000 per ounce mark in 2013.

Why the change in prediction? There is now a huge supply of gold and the excess could total $130 billion dollars for 2012. In order to sustain that amount of surplus there must be huge investment interest in gold to move the spot gold up. In addition, demand for gold jewelry is down contributing to the failure for gold surge upward, and the stronger dollar has kept pressure on gold as well.

Yet, gold does remain at a high spot price that is almost all thanks to the continued debt mess in Europe. Spain and Britain are now in recession, the US economy while growing is weak, and interest rates continue to remain low. Plus, some believe gold is in the midst of a price correction.

While gold is likely to hit $2000 per ounce next year it will probably be short lived, especially if it occurs later in the year. This is because interest rates are expected to rise in 2014, and this will work against gold. Still, gold will not be in for hard landing if indeed the current bull market ends in 2014. There will be enough bad economic news to keep gold relatively high, and gold will likely have a soft landing at worst.

Even though gold has not taken off as many investors had hoped, it is still is the best hedge going against the down economy and unstable stocks. High oil prices threaten a return of inflation, and investing in gold is a prudent move because of this. If given the choice to acquire dollars, stocks, bonds, or gold, the right option is gold. This metal has protected investors for centuries; it makes no sense to give up on it now.

On the whole, gold is expected to peak at about $1900 per ounce this year, but will probably not hit a new record until 2013. The over-supply of gold, the stronger dollar, and with gold jewelry demand down has kept gold from soaring upward. On the other hand, gold has remained steady and continues to offer a high $1600 per ounce spot price. Gold is still the best safe haven going.