George Milling-Stanley, head of the gold strategy team at State Street Global Advisors, thinks the first quarter move into gold was not hot money and is sustainable.
"We think most people were dangerously underweight gold or out of the market altogether," Milling-Stanley said in a recent interview with CNBC, conducted at the end of the first quarter's unprecedented gold run.
Here's an edited transcript of the State Street gold guru's views on the precious metal and where it will end the year. (In the first four days of trading this week, gold moved between $1,225 and $1,260. In the past 30 days, it has moved as low as $1,213 and as high as $1,269.)
CNBC: Where will gold end the year?
I would like to see gold go up steadily by about $100 in 2016, so to the $1,350 to $1,375 level by Christmas. That would be sustainable.
There is more risk to the upside than downside. We tested the downside last year, and there was good trading support at the $1,050 level. So we've moved up the bottom of the expected range to $1,150-$1,200. The lower band moving up is of course a sign that there's danger related to hot money. Hot money came flooding in and drove up the price of gold in 2011, and some of that money could come back in. So it could go up a bit further and faster than we would like. A steady, $100 rise would be healthier.