At the end of the 2020s, conservative estimates place the gold price at $4,800/oz, so argue the authors of the Incrementum’s 15th annual “In Gold We Trust” report.
The report’s authors also wrote that “should inflation rise significantly in the coming years, we believe that five-digit gold prices are conceivable at the end of the decade.”
For context, spot gold prices currently sit at $1,892.89/oz.
This amount matches projections from last year’s report, though if monetary supply growth matches roughly that of the 1970s, then the gold price could hit $8,900/oz.
The authors also argue that this scenario can coexist in a hyperinflationary world where Bitcoin thrives too.
The Golden Decade?
Gold had a remarkable 2020, increasing its value by 24.6% in U.S. dollars and 14.3% in euros. The metal’s price hit all-time highs in a number of currencies, as investors began to anticipate increasing inflation as a result of the global pandemic and the reopening of economies worldwide.
The yellow metal is valued all over the world, with a longstanding history of being a safe and reliable store of wealth.
Edward Moya, a senior market analyst at Oanda Corp., told Bloomberg: “Even if the upcoming inflation report later this week doesn’t show a significant deceleration in pricing pressures, it probably won’t change anyone’s opinion on inflation at the Fed. Wall Street should see investor demand improve for safe havens such as gold, as global tax and inflation concerns intensify.”
For investors looking to access physical exposure to the yellow metal, the Sprott Physical Gold Trust (PHYS) holds gold bullion.
Another leveraged play on rising gold prices would be miners. Sprott offers two actively managed precious metals mining ETFs: the Sprott Gold Miners ETF (SGDM), which tracks gold majors, and the Sprott Junior Gold Miners ETF (SGDJ), which tracks junior gold miners.
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