Purchasing-Power Analysis Shows Gold Is Reasonably Priced, Says BlackRock Exec

BlackRock’s Evy Hambro: Gold Not Overpriced by Purchasing-Power Standards

BlackRock’s Evy Hambro said gold could rise further, emphasizing that long-term price assumptions remain below current spot levels while miners enjoy historically strong margins.

In a Bloomberg TV interview on Tuesday, Hambro argued that gold’s valuation should be measured by what it can purchase, rather than headline prices alone. He noted that bullion stretches further for everyday items but buys less of high-value goods like U.S. pickup trucks or prime Manhattan real estate, challenging claims that gold is overvalued.

Hambro framed gold’s gains within a broader macro shift, where investors reassess real assets versus fiat currencies. While momentum and speculative positioning can drive short-term volatility, the underlying fundamentals support further appreciation. “If fiat money continues to be repriced relative to real assets, gold could go a lot higher,” he said.

This “purchasing-power” perspective also explains seemingly contradictory sentiment: record prices coexist with investors still seeing upside potential. Gold has preserved or improved buying power for routine goods even as it lags on luxury items, highlighting the limitations of single-metric valuations.

Hambro contrasted gold with bitcoin, noting that while both are influenced by inflation and currency debasement, their adoption curves and risk profiles differ.

On mining companies, Hambro emphasized fundamentals rather than predicting outperformance. Miners’ margins are strong, and analyst long-term price decks remain below spot and the forward curve. If elevated prices persist, earnings and free cash flow could continue to surprise, though volatility remains a factor.

He also distinguished gold from silver, pointing out that silver’s industrial use creates unique market dynamics. Current tensions in silver lease markets reflect supply shortages rather than misalignment of prices.

At press time, gold was $4,202.60, up nearly 60% year-to-date, while bitcoin traded at $113,042, up 20% YTD, according to MarketWatch.