A fund manager stated that although gold prices are still stagnant and unable to break above $2700 per ounce, there will be no shortage of bullish catalysts for gold prices in 2025.

Chris Mancini, Deputy Portfolio Manager at Gabelli Gold Fund (GOLDX), recently stated that his main focus is on the ongoing economic uncertainty and its impact on consumer prices.

He said, "The trend of inflation will determine the trend of gold. I believe that the rise in gold prices is due to the increasing uncertainty surrounding the economy and inflation

Amid Mancini's optimistic outlook, inflation remains high at the beginning of 2025. As President elect Trump advances the extension and expansion of his 2017 tax cuts and supports manufacturing through global tariffs, expectations of sustained inflation are growing day by day.

He said, "The bottom line is that the Republican agenda is inflation, because tax cuts will drive more liquidity into the economic system

Mancini acknowledges that gold has been struggling as an inflation hedge tool. The rise in consumer prices and a healthy labor market have forced the Federal Reserve to shorten its easing cycle, and the market currently expects only one rate cut this year.

But he added that global trade tensions may slow down the economy and weaken the labor market. He pointed out that there is significant economic uncertainty, and economists cannot completely ignore the threat of economic slowdown or even recession.

He said, "The key for investors will be to observe the labor market. Even if inflation remains high, the weakness of the labor market will prompt the Federal Reserve to cut interest rates. If the market starts to smell stagflation, then I believe gold will perform well

Although gold is expected to perform well this year following a 27% increase in 2024, Mancini suggests that investors should pay more attention to the mining industry. Despite the historic rise in gold prices, mining stocks have fallen behind.

Mancini stated that investors are still hesitant to enter mining stocks due to the industry's history of poor investment capital management. However, he explained that 2024 is a turning point for the market, and as the company continues to prove itself, he expects capital to flow back into the industry.

He said, "These past few years have been bad, but given the poor market sentiment, the only direction we can go from now on is upward. Fundamentally, the industry is in good condition and costs have been controlled. In this environment, gold mining companies should perform well. We are not far from $3000, and if the gold price rises to $3000, investors will find it difficult to ignore this industry

Mancini stated that even if gold prices remain within the current range, miners will still see robust profits and cash flow.

As investors begin to venture into mining stocks, Mancini suggests that they currently focus on productive assets, as these assets will directly benefit from the rise in gold prices. He added that as large producers seek to increase production, small producers with high-quality single mines may become attractive acquisition targets.