gold, page-129418

Argonaut's latest summary.

Probably already known, but I heard recently that the Saudis are already paying up to US$3300/oz !

Gold SectorReview

Gold pricemarching towards US$3,000/oz

Analysts | HaydenBairstow| Patrick Streater

Quick Read

Gold prices have continued tosurge, with spot prices now up close to 30% since the start of 2024.Uncertainty over the pace of forecast interest rate cuts, ongoing inflation andrising US Government debt are all likely to continue to drive a favourablepricing environment for gold. We are upgrading our gold price forecasts by11-35% over the next five years, with the spot price expected to peak at US$3,000/ozin 2026. These changes have translated to material upgrades to our earnings andprice targets of our ASX gold coverage. We reiterate our preference for stockswith strong organic growth potential, led by GMD, WGX and CMM. VAU and RRLcontinue to lead value screens, as does the West African producers PRU and WAF.Of the Australian developers, DEG, MAU and OAU remain our preferred picks.Internationally, our preferred development plays are WIA and TOK. We upgradeRMS, BGL and OBM from HOLD to BUY and SPR from HOLD to SPEC BUY on the back ofthe more bullish outlook for gold.

Key points

Gold prices forecast tobreach US$3,000/oz: We are upgradingour gold price outlook to reflect both the recent strength in spot prices andthe likely favourable backdrop for the yellow metal. We lift our FY25 forecastby 11% while our FY26, FY27 and FY28 gold price assumptions rise 26%, 35% and26%, respectively. Our forecasts now have gold peaking at just over US$3,000/ozin CY26. We have also lifted our long-term forecasts in real terms by 8% fromUS$1,850/oz to US$2,000/oz.