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Gold bulls charge as Musgrave closes in on highly anticipated Stage 1 PFS results
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There’s not much to like about the current state of the global economy – inflation and the cost of living keep rising as interest rates cripple home buyers and spook a lot of investors. But all that is exactly the reason gold has a bright future. After all, it is still known as the ‘safe haven’ for a reason.
This economic uncertainty, coupled with several bank collapses and an anticipated end to the seemingly relentless interest rate hikes, has seen the gold price in recent days revisit $US2000 ($2996) an ounce – a level it has evaded for the past 12 months.
This has the gold bulls betting big. Even central banks are buying the yellow metal at a record pace.
Fitch Solutions sees the precious metal continuing towards its all-time high of $US2075/oz in 2023, albeit amid significant volatility.
“In light of high global financial turbulence, we expect significant price volatility in the coming weeks. Nevertheless, we expect gold prices to remain elevated in the coming years compared to pre-Covid levels,” Fitch said in a March report.
The market intelligence firm says the “outlook for the global economy remains grim”.
“Our macro team expects that global real GDP growth will slow from 3.1 per cent in 2022 to 2.1 per cent in 2023,” Fitch said.
“Other than the pandemic in 2020, this would mark the slowest pace of growth since the Global Financial Crisis. Amid such a clouded global backdrop, investor interest in gold’s safe-haven status will remain strong.”
This is a good backdrop for the highly anticipated release of Musgrave Minerals’ (ASX:MGV) stage one pre-feasibility study results for its flagship Cue project in the Murchison region of Western Australia.
Musgrave is mere weeks from revealing the outcomes of the study, which is focusing on the technical and financial viability of the early years of the Cue gold project, focusing on the current higher confidence Indicated Resources.
Meanwhile, exploration and resource conversion drilling is continuing with the goal of extending the mine life beyond the first stage by increasing Cue’s total resource inventory of 927,000oz further.
Musgrave has built a solid foundation so far on which to grow the existing resource, continuing to build scale with drilling proving up the significant untapped gold potential at several prospects within the Cue project.
Most recently, the company identified a possible new high-grade lode along the Break of Day corridor – already one of Australia’s highest grade undeveloped deposits.
The Break of Day trend currently hosts a resource of 982,000 tonnes at 10.4 grams per tonne (g/t) for 327,000oz of contained gold.
Seventy per cent of this resource is in the Indicated category.
A little over a week before revealing it had identified the potential new high-grade lode along the Break of Day corridor, Musgrave reported more shallow, high-grade gold hits outside the resource whilst drilling at the Amarillo, Big Sky and Numbers East prospects.
One of the company’s main goals is to define a maiden resource for the Amarillo prospect which will likely lead to a resource update for the broader project in late 2023.
This article was developed in collaboration with Musgrave Minerals, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
