According to Credit Suisse, the price for one ounce of gold will rocket to more than $1,000 over the following five years. This is due to the combination of a decreasing supply and an increasing demand.

Analysts from the investment bank consider that by 2012 its price will increase to $1,050. It is worth mentioning that the price for an ounce of gold this week rose to the highest mark for the last 28 years, $795.

"In the current environment, upward pressure on the price of gold is being driven by the economic environment surrounding the US economy, in particular the strength of the US dollar, the oil and commodity prices and a change in the dynamics surrounding gold supply and demand," mentioned David Davis, who works as an analysts for Credit Suisse.

In his note Davis wrote that global gold production is going to fall in the next few years. This is because the decreasing number of new reserves cannot compensate for dying mines.

"We find that over the last 18 years, apart from on three occasions, the supply of gold has been in deficit. This primary deficit has been masked by the secondary supply of gold into the market mainly from central bank sales. We believe central bank sales will wither going forward and the banks could become net buyers of gold."

US Federal Reserve arranged a meeting to bring to light the decision of cutting the interest rates by a quarter point.

Bear Stearns analysts stated that cutting the interest rate, after US Federal Reserve meeting, might increase the price to more than $800 in just one week. They also mentioned that the price is likely to rise even higher, to a record of all time of $830.

According to Credit Suisse, an important factor that leads to the increase of gold price are high prices for oil. "Higher oil prices are likely to result in inflationary pressures in the US, which in turn will likely result in upward pressure on the gold price because of gold's use as an inflation hedge," said the bank's representatives.