Which US presidential candidate does gold prefer?
Gold loves chaos and should be hitting new highs, especially with inflation coming down and with it, two rate cuts likely before year’s end.
(Bloomberg) — Gold has bottomed out and may be set to soar, according to one of the industry’s biggest bulls.
Prices could surpass $5,000 an ounce in five years, from about $1,280 now, as investors seek returns amid a prolonged period of cheap money and use the metal as a haven from geopolitical and financial risk, McEwen Mining Inc. Chief Executive Officer Rob McEwen said.
If that happens, “there is going to be a tsunami of money looking for a place to go,” he said in an interview from an industry conference in San Francisco.
Lower-for-longer interest rates have fueled bubbles in the stock, real-estate and even art markets as investors seek out higher returns, McEwen said. While conventional wisdom is that a return to higher rates would make interest-bearing assets more attractive, he said gold should become more appealing as markets re-calibrate.
To be sure, McEwen said in September 2016 that gold could trade in a range of $1,700 to $1,900 by the end of that year. The metal ended 2016 below $1,150 as the dollar surged.
Story by Mark Chediak with assistance by Danielle Bochove.
