UBS Analysts Bullish on Gold: Price Forecast to Reach $3,000 by 2025
In a recent note, UBS analysts have expressed confidence in the future of gold, predicting a price surge to $2,800 by the end of 2024 and $3,000 by 2025. This positive outlook is driven by strong demand for gold across various market segments and a lack of selling pressure.
The upward revision in price forecasts is supported by macroeconomic factors such as ongoing monetary easing by central banks worldwide, leading to a favorable environment for gold investments. Lower interest rates reduce the cost of holding gold, enticing investors to increase their allocation to the precious metal. Additionally, a weakening U.S. dollar is expected to boost gold prices as investors seek alternatives to traditional currencies.
Geopolitical tensions and the upcoming U.S. elections further contribute to the bullish sentiment towards gold, with investors turning to the metal as a safe-haven asset amidst economic uncertainties. Despite the consensus on higher gold prices, market positioning remains relatively low, leaving room for further investment in gold in the coming quarters.
UBS analysts also anticipate central banks and official institutions to continue adding to their gold reserves, citing diversification strategies and geopolitical risks as driving factors. Consumer demand for physical gold, especially in key markets like China and India, is expected to remain robust despite the higher prices.
In conclusion, the outlook for gold appears positive as demand remains strong and various macroeconomic factors support higher prices. Investors may consider adding gold to their portfolios as a hedge against market uncertainties and potential currency devaluation.