BlackRock's head of natural resources, Evy Hambro, has criticized the recent surge in share buybacks by major gold mining companies, calling the trend "reckless" and "undisciplined." Speaking at the Financial Times Mining Summit, Hambro expressed disappointment over the last 18 months, during which gold miners allocated significant capital to buybacks without thorough evaluation.
Hambro highlighted that four of the largest gold miners, Barrick Mining (B), Newmont (NEM), AngloGold Ashanti (AU), and Gold Fields (GFI), have collectively announced share buyback programs worth approximately $12 billion. BlackRock holds substantial stakes in each of these companies. Hambro contrasted the meticulous planning that goes into $1 billion investments for new mines with the lack of scrutiny in $1 billion share buyback decisions.
Despite this criticism, BlackRock remains optimistic about the long-term prospects for gold. Hambro pointed to the growing debts and deficits of governments worldwide, suggesting that the depreciation of paper currencies will drive up the value of real assets like gold. "You see no plan from governments to fix the problems, beyond doing more and more of the same," Hambro noted.
On Friday, gold futures saw a slight increase as the U.S. dollar weakened for a second session, though yields ticked up. The front-month Comex October contracts for gold (XAUUSD) and silver (XAGUSD) rose 0.3% to $4,159.50/oz and $56.995/oz, respectively. For the week, gold slipped 0.7%, and silver dropped 6%.