What's Happening?
UBS has increased its gold price forecasts, projecting a price of $3,600 per ounce by the end of March 2026, up from $3,500. The investment bank also introduced a new forecast of $3,700 per ounce for the end of June 2026. The revised forecasts are driven by persistent US macroeconomic risks, including high inflation and below-trend economic growth, which are expected to support higher gold prices.
Why It's Important?
Gold is often viewed as a safe haven asset during times of economic uncertainty. UBS's revised forecasts reflect concerns over US macroeconomic conditions, such as inflation and growth rates. These factors could lead to increased demand for gold, impacting investment strategies and asset allocations. The forecasts also highlight the ongoing interest in gold as a hedge against economic instability.
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What's Next?
UBS anticipates continued strong demand for gold, particularly from exchange-traded funds and central banks. The bank has raised its annual ETF gold demand forecast, citing significant inflows. Investors will be monitoring economic indicators and Federal Reserve policies for further signals that could affect gold prices. The ongoing geopolitical uncertainties and fiscal sustainability concerns may continue to drive demand for gold.
