Gold’s pullback is a buying opportunity as debt risks continue to grow, says Tavi Costa

NEW YORK (March 19) The gold market continues to frustrate investors, as it has seen its second 4% single-day loss since the U.S. and Israel started a war with Iran—an event that is creating significant economic uncertainty and driving energy prices and inflation higher.

Spot gold is currently trading at $4,610.90 an ounce, its lowest level since the sharp selloff that followed its record high near $5,600 in January.

While gold prices could continue to move lower in the near term, one fund manager said that these corrections and periods of short-term volatility are where investors can make real profits, as rising government debt and limited central bank action continue to support higher gold prices over the long term.

In an interview with Kitco News, Tavi Costa, founder and CEO of Azuria Capital, said he sees the current pullback in gold as noise within what he believes is a much larger, still early-stage bull market for precious metals—one increasingly driven by structural forces reshaping both the mining industry and the global economy itself.

While gold is facing pressure from tighter liquidity conditions and shifting rate expectations, Costa said the macro backdrop remains firmly supportive.

“There’s zero chance this is the end of the cycle,” he said.

He explained that he believes the key driver behind gold’s long-term trajectory is not near-term market sentiment but the unsustainable nature of global debt. Governments, particularly in the United States, are facing rising interest costs that are crowding out other forms of spending. As a result, he expects policymakers to prioritize lowering rates—regardless of inflation data or traditional economic signals—in order to reduce the burden of debt servicing. That shift, he argues, will be a powerful tailwind for gold.

Costa’s comments come as U.S. government debt has now surpassed $39 trillion. There are growing expectations that, because of the cost of the war with Iran, U.S. debt could reach $40 trillion before the fall.

This macro framework was also the central theme of a presentation Costa delivered at the Prospectors & Developers Association of Canada (PDAC) 2026 Convention, where he outlined what he sees as a historic inflection point for hard assets.

Even after gold’s standout performance last year, Costa said the sector remains under-owned and undervalued relative to the scale of the opportunity. He noted that U.S. gold reserves represent only about 3% of federal debt today, compared to roughly 51% in the 1940s.

That imbalance, he suggests, underscores how much room there is for gold to reprice higher if governments move to rebuild reserves or restore confidence in their balance sheets.

At the same time, he sees a major structural shift underway in global reserve management. Many countries—particularly in emerging markets—are increasingly moving away from U.S. Treasuries and toward gold. This trend, combined with the likelihood of a weaker U.S. dollar over time, reinforces his bullish outlook for precious metals.

“ In situations like this, a lot of people tend to think in the short term and believe the thesis has shifted,” he said. “But this is the moment where you build wealth. You should be adding to your positions when you're down. This is the moment where those with high conviction buy, not sell—and I am one of those people.”

However, Costa’s conviction extends beyond gold into mining equities. He said the industry is in the “early innings of a major cycle,” with capital flows poised to accelerate.

One of the most compelling aspects of the current setup, he said, is the disconnect between metal prices and mining valuations. Even as gold and silver prices have surged, many producers continue to trade at relatively modest multiples, and in some cases, companies are generating margins comparable to those seen in technology firms, with production costs far below prevailing metal prices.

Costa attributes this valuation gap to investor skepticism about the sustainability of higher precious metals prices, but he said this skepticism is misplaced. He explained that supply constraints across the mining sector are becoming increasingly acute and are unlikely to be resolved quickly.

According to data Costa highlighted at PDAC, the industry has seen virtually no major discoveries over the past two years—an unprecedented development in modern mining history.

This shortage of new deposits comes after years of underinvestment in exploration and development. Capital expenditures across the broader commodity sector have been significantly constrained since the last cycle, limiting the pipeline of future supply. As a result, Costa believes the industry is setting up for a prolonged period of tight supply and structurally higher prices.

KitcoNews