According to Eric Strand, founder and CEO of AuAg Funds, the gold market’s recent surge can be attributed to a combination of factors, including the US interest rates and inflation landscape, backdoor quantitative easing by the Federal Reserve leading to an increased monetary base, and geopolitical tensions.
Strand emphasized gold’s historical safe-haven status, further reinforced by recent geopolitical developments and central banks’ desire to increase their gold reserves as a hedge against potential future crises. He noted that central banks worldwide, notably China, have been significant buyers of gold, contributing to its price elevation.
While acknowledging the potential negative short-term impact of large retail positions in the US Commodity Exchange, Strand maintained an overall positive outlook for gold’s future pricing, predicting it could reach around $2,475 to $2,500.
Strand also pointed out that gold miners, which were previously undervalued, have begun to see significant returns, attributing this to stabilized costs and rising gold prices benefiting miners’ profit margins.
The discussion also covered uranium mining, highlighting it as a growing sector due to its role in green energy and the construction of new nuclear reactors. However, Strand cautioned about the binary risk associated with accidents in the uranium market.
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