The economic and political problems that have sent investors toward gold and silver are going to continue, said CPM Group’s Jeffrey Christian.
This interview is part of the Investing News Network’s coverage of PDAC 2021. Click here for the full playlist.
The gold price has declined a fair amount since reaching an all-time last summer, but for CPM Group’s Jeffrey Christian, the outlook for the yellow metal remains strong.
“You’ve got to put the ‘low gold prices’ into perspective,” he told the Investing News Network. “Gold prices today are higher than they’ve ever been prior to June of last year. So yeah, we’re off from the high, but we’re very strong. And there is a tremendous amount of gold interest that’s still there.”
After last year’s momentum, CPM Group sees gold being more muted in 2021 and 2022. However, the firm still anticipates that the metal will be 6 percent higher this year on an annual average basis.
Looking longer term, the expectation is for gold to reach record levels in the next three to five years.
Christian, who is managing partner at CPM Group, said his firm is also bullish on silver in the long term and has been for the last several years. He believes prices could rise sharply higher due to a variety of factors, including investment demand — although that likely won’t happen until 2023 or 2025.
“Going forward, we think that those economic and political problems that have caused investors to say, ‘I want more gold and silver’ are going to continue,” he said.
Christian touched on platinum and palladium as well, saying that he’s increasingly being asked about platinum/palladium ratio trades. It’s possible to do that, he said, but the better plan is to buy platinum and hold onto palladium as well. “We’ve been saying don’t sell palladium short to offset your long platinum — buy the platinum, but hold onto your palladium,” he said.
Aside from precious metals prices, Christian also discussed three factors that may be flying under the radar for investors: bullion banks getting out of precious metals trading (or severely reducing their positions), central banks lowering their gold purchases and backups in the market for physical metals.
Watch the video above for more of his thoughts on the gold and silver spaces.
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.