With uranium and gold in a holding pattern, it's a bit of a lean update this week, but there's still plenty to sink your teeth into. Here's the buzz.
Uranium
Notable analysts predict "sustained" bull market
John Quakes reposted Goehring & Rozencwaijg's analysis of the uranium market, which predicts a "sustained and frenetic bull market" that we've only just begun to touch.
As Quakes points out, the conclusion is a strong one: "The cumulative deficit between 2023 and 2030 will likely exceed 250 mm lbs, completely depleting all commercial stockpiles," G&R write, adding that "uranium has likely reached a pivotal inflection point that could force the price higher by as much as three- to four-fold over the next several years."
Italy is returning to nuclear power
One of the big banner items for the uranium thesis has been the growing trend of countries turning to nuclear power over the coming decades. With Italy, we're seeing one more district that had sworn off nuclear returning to its consistent baseload power, with an eye toward reducing emissions.
Italy's strategy bears out one aspect of the uranium bull's thesis: That countries will need to use nuclear power in order to meet their emissions targets.
Gold
Reuters: Gold moves higher as yields, dollar slip after U.S. inflation data
As Reuters reports, gold's spot price rose a bit on the morning of Nov. 14 after the latest U.S. inflation data was posted. Inflation was softer than many expected, which is spurring analysts to predict that the Federal Reserve may have hit its interest rate peak.
Higher inflation can be gold for gold, but in this case, as inflation slows, it seems less likely that the Fed will continue to hike interest rates.
“CPI data came in significantly weaker than expected, which is quite supportive for precious metals. We are expecting a significant deterioration in the data over the course of the fourth quarter, which should weaken dollar and support gold,” Daniel Ghali, commodity strategist at TD Securities, told Reuters. “Over the next six months, we’re looking at gold prices to rally towards $2,100 per ounce.”
Rick Rule weighs in on gold and uranium
Kitco covered the New Orleans Investment Conference, posting a number of juicy interviews. This one comes from one of our favourite uranium and gold pundits, Rick Rule, in which he covers his usual bullish talking points on both metals. But while this is ostensibly a uranium-focused interview, we found this bit toward the end about gold investment market share the most encouraging:
"The market share of precious metals and precious metals securities relative to other assets classes is 0.5%. Put differently, of the total savings and investment assets in the United States, only 0.5% is comprised of precious metals investments. The four-decade mean market share of precious metals was 2%. Gold doesn't have to win the war against the U.S. dollar … it just has to lose the war less badly. If demand to gold were to revert to the 40-year mean, demand for precious metals in the U.S. would increase fourfold. And that's precisely what I think is going to happen."
