The gold price is currently causing nervousness once again. Since the start of the war involving the USA and Israel against Iran, the precious metal has recorded a daily loss of 4% for the second time. Yesterday, the spot price fell intraday to support at USD 4,500 per ounce, its lowest level since the sharp sell-off following the record high near USD 5,600 in January. For many market participants, this is further evidence of how vulnerable even a structurally strong-looking market can remain in the short term.
At the same time, some observers do not interpret the current decline as the end of the movement, but rather as an intermediate step within a broader environment of economic and fiscal tension. According to Tavi Costa, CEO and founder of Azuria Capital, the setback in the gold price is part of a much larger and, by this reading, still early bull market for precious metals. The focus of this argument is not on short-term market fluctuations, but on longer-term forces such as global debt development, a shift in the reserve policies of many nations, and structural bottlenecks in the mining sector.
Gold price suffers in the short term from liquidity requirements and interest rate expectations
The immediate pressure on the gold price in the current phase is primarily explained by a more difficult market environment. Tighter liquidity conditions and changing expectations regarding interest rate policy are weighing on gold, while economic uncertainty is simultaneously increasing due to the war with Iran. Rising energy prices and growing inflationary pressure are further exacerbating this situation.
It is precisely this mixture that makes the development of the gold price so contradictory. On the one hand, gold is traditionally seen as a hedge against uncertainty and geopolitical tension. On the other hand, an environment of tighter liquidity and shifting interest rate expectations can put short-term pressure on the very market segments that previously benefited from the flight to safety. The result is a market that reacts to macroeconomic tensions with high volatility.
From the perspective of Azuria Capital, however, this short-term unrest is not decisive for the long-term trajectory. There, the decline is classified more as noise within a larger upward movement. The overarching thesis relies less on daily market events and more on fundamental shifts in state finances, monetary orders, and raw material supply.
Azuria Capital sees global debt as the core of the gold price trend
According to this assessment, the most important driver for the long-term gold price lies in global debt. The USA is particularly in focus. National debt now stands at more than 39 trillion US dollars, and given the costs of the war with Iran, there is increasing speculation that the 40 trillion US dollar mark could be reached before autumn. For Azuria Capital, this development is not just a fiscal problem, but a structural factor likely to have a lasting influence on the direction of monetary policy.
The reasoning behind this is clear: as debt rises, so do the state’s interest costs. This interest burden crowds out other areas of expenditure and increases the pressure on policymakers to lower financing costs again. From this, Azuria Capital derives the expectation that political decision-makers could prioritize lower interest rates in the medium term—even if inflation data or classic economic signals would actually suggest restraint. From this perspective, that would be a strong tailwind for the gold price.
This viewpoint was also the focus of a presentation by Azuria Capital at the PDAC 2026 conference, the world’s largest mining convention. There, gold was described as part of a historical turning point for tangible assets. Despite the already strong performance of the previous year, the sector is still considered underrepresented in investor behavior according to this reading. Added to this is a comparison intended to illustrate the structural change: according to this presentation, US gold reserves today correspond to only about 3% of US federal debt, whereas this share was still around 51% in the 1940s.
Azuria Capital sees global debt as the core of the gold price trend
In addition to the debt issue, Azuria Capital points to another structural movement: the change in global reserve behavior. According to this, many countries, particularly emerging markets, are increasingly shifting their reserve strategy away from US Treasuries and more toward gold. For the gold price, this is a decisive factor because it creates an additional source of demand that does not depend solely on Western investor flows.
This trend is further reinforced in Azuria Capital’s assessment by the prospect of a weaker US dollar over a longer period. When states place more trust in physical reserves and less in US debt instruments, it changes the role of gold in the international financial system. The gold price then appears not only as a crisis indicator but also as an expression of a broader reorganization of currency and reserve relations.
This is precisely why the current decline is not interpreted as a fundamental break in sentiment. Rather, from this perspective, it is about the discrepancy between short-term market reaction and the long-term background. The gold price may be under pressure in the short term, but according to this argument, the structural drivers remain intact.
Mining stocks also remain part of the gold price thesis
Azuria Capital’s view does not end with the metal itself. Gold mining stocks are also described as part of an early cycle. Particular emphasis is placed on the gap between the metal price and the valuation of many producers. Although gold and silver have risen sharply, numerous mining companies continue to trade at comparatively moderate valuation multiples.
This is relevant for the gold price insofar as this discrepancy indicates a continued skeptical investor environment. In the view of Azuria Capital, part of the market still doubts that higher precious metal prices can be sustained. It is precisely this skepticism that is reflected in the valuations. At the same time, however, many producers are already achieving margins more commonly seen in other industries, while their production costs are significantly below current metal prices.
Furthermore, there is a structural supply problem. At the PDAC, data was cited showing that there have been practically no significant new discoveries in the past two years. For modern mining history, this would be an extraordinary finding. This is linked to years of low investment in exploration and development. According to this reading, this results in a tighter future supply profile—and thus an environment that could support the gold price and the entire precious metals sector over a longer period.
The bottom line is a picture full of tension: in the short term, the gold price remains vulnerable to sharp setbacks triggered by liquidity, interest rate expectations, and geopolitical uncertainty. In the long term, however, the market is shaped by factors that, in Azuria Capital’s assessment, go much deeper—from debt and interest burdens to reserve reallocations and a thinned-out supply side in mining.
