Gold continues to be hot, with prices hitting record highs. Precious metal prices hit an all-time high of $2,531.60 an ounce on Tuesday, after hitting a record high last week. Spot gold prices were last around $2,490 on Friday. As expected, gold mining stocks have also followed the trend, with the VanEck Gold Miners ETF hitting its highest level since mid-April 2022 on Tuesday. UBS said geopolitical risks will continue to support gold, pointing to tensions in the Middle East and the recent Russia-Ukraine conflict. “We view allocations to oil and gold as the primary means of providing some portfolio protection against further escalation of geopolitical tensions,” the bank said in an Aug. 12 report. “In the meantime, gold should play its role Acting as a more conservative asset.” UBS predicts that gold prices may rise to $2,700 an ounce by mid-2025. David Neuhauser, chief investment officer of Livermore Partners, also said that gold prices could reach $2,700 in 2025 and $3,000 in the next three years. “I believe the dollar has more room to rise with slowing consumers, large (government) deficits, upcoming elections (in which neither party plans to provide austerity measures to reduce spending and debt) and stubborn inflation. and geopolitical divisions,” he told CNBC Pro. A weaker U.S. dollar tends to push the price of gold (which is typically priced in U.S. dollars) higher because it gives buyers more purchasing power. It is considered a hedge against inflation and market volatility. Meanwhile, ANZ Research said demand for the precious metal is likely to remain strong. “We believe China’s gold imports remain elevated on an annual basis, while India’s improving rural incomes and import tariff cuts will boost its gold consumption in the coming months,” ANZ strategists wrote. Central bank purchases have slowed, but we expect annual purchases to reach 800 tons in 2024. Unknown gold purchases dominated quarterly demand, offsetting weakness in reported monthly purchases,” Wolfe Research said on August 21. The VanEck Gold Miners ETF is not yet overbought, according to a report today. “We have been highlighting the potential for gold miners to catch up on trade that has failed to keep pace with base metals,” they wrote. “The potential for a meaningful breakout has never been greater,” the company wrote. : “On top of that, mining stocks have relatively outperformed gold since March, and we think gold mining stocks are ripe for an eventual breakout.” It highlights two “compelling” ways to prosper: Buy shares of U.S.-listed Royal Gold Corporation and Newmont Corporation. Royal Gold has a “very compelling setup” while Newmont has “plenty of room to run,” Wolfe said. Neuhauser said he believes select junior gold miners are stocks worth owning, referring to gold miners focused on the early exploration stages of discovering new deposits. He likes and owns Amaroq Minerals and Hochshild Mining, as well as Coeur Mining and Canadian-listed Wesdome. —CNBC’s Michael Bloom contributed to this report.
