(Bloomberg) — Gold has bottomed out and may be set to soar, according to one of the industry’s biggest bulls.
Prices could surpass $5,000 an ounce in five years, from about $1,280 now, as investors seek returns amid a prolonged period of cheap money and use the metal as a haven from geopolitical and financial risk, McEwen Mining Inc. Chief Executive Officer Rob McEwen said.
If that happens, “there is going to be a tsunami of money looking for a place to go,” he said in an interview from an industry conference in San Francisco.
Lower-for-longer interest rates have fueled bubbles in the stock, real-estate and even art markets as investors seek out higher returns, McEwen said. While conventional wisdom is that a return to higher rates would make interest-bearing assets more attractive, he said gold should become more appealing as markets re-calibrate.
To be sure, McEwen said in September 2016 that gold could trade in a range of $1,700 to $1,900 by the end of that year. The metal ended 2016 below $1,150 as the dollar surged.
Story by Mark Chediak with assistance by Danielle Bochove.