30 June 2023
Gold and silver prices have surged this year, and according to analysts, the rally is just getting started. Adam Rozencwajg of Goehring & Rozencwajg (G&R) believes that gold has entered a new phase of its bull market. One key factor driving this is the increased demand for gold from central banks, which have been purchasing bullion at record levels. In the first quarter of 2023 alone, central banks bought a combined 228 tonnes of gold, the most ever seen in a first quarter. The trend is expected to continue due to geopolitical risks and elevated inflation. Furthermore, the weakening US dollar and the potential shift away from the US dollar-led reserve currency system are factors that could further drive up the price of gold. G&R has set a price target for gold between $12,000 and $15,000 per ounce. Additionally, historical data suggests that commodities, including gold, are currently undervalued compared to financial assets, indicating the potential for significant gains in the future. Overall, experts remain bullish on gold and see it as the start of the second leg of a long-term secular bull market.