Third, it is a great time to buy gold because the metal is on a cyclical upswing as mentioned above. Chances are there would be more accounting and owning up for the sub-prime turmoil in the mature markets.

The dollar could weaken some more, before there is actual intervention to steady it. Oil producing economies are not willing to talk about increasing oil supply that could bring prices down.

Even with the possibility of enhanced supply from the IMF sale, gold prices could continue rising. Now, it seems, is as good a time to buy as any other. That said, there would be days on which bullion prices will fall. But, this is unlikely to be a long-term trend.

Though analysts are reluctant to put a number to it, the overall consensus is that the price of gold two or three years from now would certainly be higher than it is now, inflation adjusted. But the 46 per cent return of the last six months is unlikely to get repeated. Settle for above-inflation returns in an otherwise boggy market.

Says Gnanasekar: "Gold still has a long way to go. My estimate is that it would go up to at least $1,400 per unit by next year. There is a big supply constraint and the dollar situation is not likely to change overnight."