Gold stocks set to climb on inflation fears

By CanadianMiningReport.com Staff Writer / November 13, 2021 / Article Link

Gold prices have made their way to their highest level in nearly three months driven by a weaker dollar and fears over a rising U.S. inflation. An earlier dip in the price of Bitcoin saw investors pull away from cryptocurrencies as they turn to gold as a proven long-term hedge against inflation.

Analysts are waiting for the metal’s performance in the short term before making any prognosis about the coming months.

Spot gold was up nearly 4% in past five trading session, trading at $$1,857.90 per ounce on Thursday. We haven’t seen gold price touch this level since June although it remains to be seen if the commodity is now poised for a breakout.

The move in gold prices comes after inflation numbers for the month of October came in worse than expected. The Consumer Price Index (CPI) jumped6.2%, a 31-year high, which shows a 0.9% increase on a monthly basis against the 0.6% estimate.

Annual core inflation surpassed expectations at 4.6%, and fuel oil prices soared 12.3% for the month, and 59.1% over the past year. Energy prices also climbed 4.8% in October and 30% for the 12-month period.

As a result, gold stocks saw an influx of investors interest. Top Gold Stocks this week include Kinross Gold Corporation ( NYSE: KGC ) McEwen Mining Inc. ( NYSE: MUX ) and Gold Fields Limited ( NYSE: GFI )

Kinross Gold Corporation (NYSE: KGC) operates in the United States, Canada, Russia, and other countries. Its third-quarter results for 2021saw the company meet its revised production guidance of 2.1 million gold equivalent ounces by a 5% margin. It is expected that production will increase in the following two years to 2.7 million and 2.9 million respectively. With an operating cash flow of $190.5 million its portfolio of mines performed well and put the companyre on track to meet its revised production and cost guidance for the year. A quarterly dividend in addition to this makes this mining stock a good buy for your portfolio.

McEwen Mining Inc. (NYSE: MUX) works in the United States, Canada, Mexico, and Argentina. Its Gold Bar mine, Black Fox mine, and El Gallo Project are its main focus at the moment. Third-quarter results showed the company is on track to reach its production targets for 2021. The corporation stated that it is on track to reach its production targets for 2021. With $72.7 million in cash and liquid assets and $45.8 million in working capital as of September 30th, 2021, the company has achieved substantial progress. Plans to invest $6.2 million in exploration and $4 million in advanced projects “aggressively” mean that shareholders can expect to see more profitability coming from this gold stock in the near future.

As the risk of higher inflation persists the effects from the monetary and fiscal policies put in place as a response to the COVID-19 pandemic  should support investment demand for gold as inflation hedge.