Rising interest rates and a strong US dollar weighed on gold in 2022, but 2023 may bring relief.
Dr. Kal Kotecha, president and founder of Junior Gold Report, said he sees rates approaching the point where they top out.
“Interest rates have gone up quite a bit … and I think we’re reaching the peak level of interest rates,” he said at the Prospectors & Developers Association of Canada (PDAC) convention. “So I expect gold to go up in price when interest rates start to dip.”
Kotecha focuses on the junior resource space and noted that these companies can take time to move.
“It kind of concerns me that the juniors are not following (gold),” he said. “It’s a pretty strong gold price, especially when the US dollar is high. I hope the market sentiment is changing in the junior mining sector, but I don’t see that happening in the short term.”
Inflation remains a headwind both inside and outside the mining sector, and Kotecha pointed out that even if it declines as the year continues, prices for food and other goods may not immediately fall back.
He also mentioned Newfoundland, a jurisdiction he finds exciting, and said he sees opportunity in the energy transition trend, including green hydrogen and wind power, as well as anything to do with critical minerals.
Watch the interview above for more of Kotecha’s thoughts on gold, as well as his outlook for the general economy. You can also click here for the Investing News Network’s full PDAC playlist on YouTube.
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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.
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