(Kitco News, Fri. Nov. 10th, 2023 ) – Gold prices have been held back by the strength of the U.S. dollar in 2023, but the yellow metal could be poised for a big breakout in the near future, according to Philip Petursson, Chief Investment Strategist at IG Wealth Management.
In a recent interview with BNN Bloomberg, Petursson said that even at $2,000 per ounce, gold has considerable upside, and the coming year should see prices appreciate significantly.
“Gold has been weighed down by the strength and the U.S. dollar for most of this year,” Petursson said. “They tend to be inversely correlated, so as U.S. dollar strengthens gold tends to weaken a little bit. Now, if we think that the U.S. dollar is going to soften from here, and I think that is our base case going into 2024, that’s positive for gold.”
Petursson said IG believes gold is undervalued by as much as 20%. “Once it catches this bid and breaks through, solidly breaks through $2,000, we think it can go higher to potentially $2,400 to possibly $3,000 per oz.”
Many believe the gold price will go up just based on the overpriced equity markets now selling at record high price to earnings or P/E ratios, some as high as 50 x earnings that simply will not be supported by investors going forward, not with the two precarious global wars taking place simultaneously plus wild inflation spreading across the U.S.