Will 2023 be the Year of Gold: World Gold Council at BMO Conference

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If last year was the year of the dollar, 2023 may be a year that gold starts to gain momentum, especially if the World Gold Council’s (“WGC”) efforts to digitize the way gold is traded continue to garner excitement.

The WGC launched its Gold247 project with a vision to change the way the precious metal is traded to make it more efficient, transparent, and, ultimately, fungible, and the project remains one of its main missions, it said after a meeting held at the BMO Capital Markets 32nd Annual Global Metals, Mining & Critical Minerals conference.

The idea is that in standardizing the way gold is traded, and therefore eliminating associated capital impediments that have long encumbered capital flow into the industry, you create an environment that is also more attractive to investors.

“So, all the trillions of investment dollars that have hitherto gone to currencies, stocks, bonds, credit and anything else, will come back to gold, simply because the costs of trading it will be removed for the first time in history,” WGC Chief Executive Officer David Tait said after emerging from the meeting in Florida. “If we can alter that dynamic and introduce, as the World Gold Council can prove, 5 percent into your portfolio, into everybody’s portfolio, that’s an awful lot of gold.”

According to Council Chair Randy Smallwood, Gold247 is generating a buzz among gold miners.

“This Gold247 initiative has got our membership very excited … We had two new members join us today,” Smallwood said after the meeting on the sidelines of the Florida conference. “This was probably one of the biggest turnouts we’ve had for the World Gold Council meeting in the last five years.”

Gold prices have been stagnant of late, but there was a sense at the BMO conference that that may turn around. “We remain fairly constructive on gold prices,” BMO Capital Markets Commodities Analyst Colin Hamilton said after the WGC meeting. “From our perspective, we do have our base case that risk-on sentiment will improve in the second half of this year.”

Smallwood said that this year gold prices would see a stronger foundation.

“I think 2022 was the year of the US dollar, the strongest it’s ever been,” Smallwood said after the WGC meeting. “I think 2023 is the year that gold starts taking its place. We’ve seen record buying by central banks.”