Agnico Eagle Mines Ltd. Chief Executive Officer Sean Boyd expects gold prices to continue to strengthen amid global economic uncertainty and deficit spending, and the metal may hit a record US$2,000 an ounce in the next two to three years.

“Governments focus on running a deficit budget and spending; that loose money approach is good for gold,” Boyd said Thursday in a telephone interview. “You continue to get good buyer demand from China, India and the biggest buying coming from the central banks since the early 1970s.”

The Toronto-based miner plans to increase dividends and strengthen its balance sheet with the extra cash flow generated from higher gold prices, while share buybacks aren’t something the company is considering at the moment.

Bullion futures have risen 17 per cent this year as trade tensions and faltering global growth increased demand for the metal as a haven. They settled at US$1,495.70 on Wednesday. Prices hit a record US$1,923.70 intraday in New York in September 2011 as the dollar fell amid massive U.S. quantitative easing programs to stimulate the economy.

On Wednesday, the Canadian gold producer reported third-quarter earnings and revenue that beat analysts’ estimates as gold production climbed to a quarterly record of 476,937 ounces. Agnico increased its 2019 forecast to a range of 1.77 million to 1.78 million ounces, from previous guidance of 1.75 million. For 2020, Agnico expects annual gold output to reach 1.9 million to two million ounces.

Meanwhile, Agnico raised its 2019 capital costs estimate to US$790 million from previous guidance of US$750 million.

Agnico rose five per cent to $74.13 at 10:43 a.m. in Toronto on Thursday, boosting its year-to-date increase to 34 per cent.