Commodities

Why this investor is bullish on gold in 2024

The price of gold reached a record high this month and a veteran gold watcher expects the precious metal to surge even higher in 2024.

Gold reached US$2,135 per ounce on Dec. 3. As of Thursday, the price of gold was $2,075.39, or roughly 14 per cent higher than it was in October.

John Ing, gold analyst and president and chief executive officer of Maison Placements Canada, told BNN Bloomberg he believes gold will reach $2,200 next year – a target he says he’s “talked about for many years.”

In a Thursday television interview, Ing said he believes the fight against inflation is far from over, despite recent slowdowns in the U.S. and Canada, and expects gold prices will continue to rise as a hedge.

“There still are the momentum forces for inflation, and my expectation is much higher gold prices,” Ing said.

Ing noted that central banks have been active in the gold market this year, buying the commodity “at a record pace” against a declining U.S. dollar.

“On a trade basis, U.S. dollar usage is declining, so my belief is that central banks are sort of hedging themselves and diversifying,” he explained.

Less gold is being brought to markets due to “very few” big recent discoveries, Ing noted. He views this as another factor driving up gold prices.

“It takes 10 years nowadays to get gold from the first exploration to actual production. It just takes so long,” he said.

These challenges partially explain the uptick in mergers and acquisitions in the gold sector in 2023, he added.

“When I look at the gold mining industry, less gold is coming to the market and costs are increasing,” Ing said. “Therefore these gold stocks look very attractive.”