Rising government debt and weaker currencies could keep gold prices elevated over the long term, even as the market faces short-term volatility, according to Brien Lundin, editor of Gold Newsletter. Speaking at the New Orleans Investment Conference, Lundin said that although gold and silver have fallen back to prices seen about a year ago, the factors driving their long-term rise remain in place, as reported by the Investing News Network (INN). Lundin pointed to central bank buying as a key pillar of the rally.
Central banks increased their gold purchases in 2022, buying 1,136 metric tons. That increase followed Russia's invasion of Ukraine and the freezing of Russian central bank assets held overseas by several countries, which raised concerns about the security of foreign currency reserves. Lundin said this highlighted growing concerns about the use of the US dollar and the global financial system as geopolitical tools, and that central banks have continued to buy gold through price fluctuations, viewing it as a strategic reserve asset.
According to World Gold Council (WGC) data cited in the article, central banks and other official institutions added 321 metric tons of gold to their reserves in the third quarter of 2026, a 42 percent increase from the same period a year earlier. Net purchases for the first nine months of 2026 reached 675 metric tons, up 6 percent year-on-year. Lundin also noted that the WGC had estimated official-sector buying of 244 metric tons in the first quarter of 2025, a figure later revised to 237 metric tons, and that much of the estimated buying was not reflected in official reports at the time.
Lundin also cited other institutional holders, including stablecoin issuer Tether, which he said held about 125 metric tons of gold as of the end of the first quarter. He argued that sovereigns and large institutions helped drive gold higher before Western investors joined the rally. Lundin attributed the recent market correction to several factors, including the nomination of Kevin Warsh as Federal Reserve chair and concerns about the war involving Iran.
He said the nomination prompted investors to reassess the outlook for monetary policy, while the conflict added uncertainty around energy prices, inflation and government spending. He also said artificial intelligence has become a competing destination for investment capital, drawing money away from the metals sector. Despite the pullback, Lundin said such corrections are common and that the lesson of the bull market is to buy on dips.
He described investors as facing two simultaneous long-term bull markets: one driven by monetary pressures supporting gold and silver, and another supported by supply constraints and rising demand for commodities such as copper, critical metals and energy metals. On fiscal policy, Lundin said rising government debt is making it harder for the Federal Reserve to keep interest rates high without increasing the cost of servicing that debt. He said US federal debt was approaching US$40 trillion, with debt-to-GDP at about 120 percent, compared with 34 percent in 1980.
He argued that heavily indebted countries, including the United States, will eventually have to devalue their currencies to manage their debt burdens. Comparing the current rally with previous bull markets, Lundin estimated that gold prices could reach US$6,000 to US$8,000 based on historical gains from the December 2015 low, while cautioning that there is no clear timeline for such an increase. He pointed to mounting government debt and currency pressure as potential triggers for a shift in the global monetary system.
Referring to the 1970s, he said: “If you include or take the 1970s as one cohesive bull market, then over that period the price of gold went up 24.4 times. So again, judging from that base of well over US$1,000 that means at the end of this process we would be in the mid 20s.” Lundin added: “That implies a significant, real monetary reset of some sort. I'm not going to rule that out.
Neither am I going to promise it, but we still need to know that that gives a possibility. That's the kind of market that we're in.” For context, INN market data showed spot gold quoted at US$3,924.48 as of November 3, 2026, down 0.59 percent on the reported session, and spot silver at US$49.56, down 2.11 percent. Sources: Investing News Network interview with Brien Lundin (author: Aastha Sethi, November 3, 2026); World Gold Council central bank demand data; INN market data.
The views expressed are those of Brien Lundin and do not necessarily reflect the views of the Investing News Network, and do not constitute investment advice.
Source: investingnews.com