UBS says gold is its “Most Preferred” in its global asset allocation

UBS analysts have reaffirm their bullish outlook on gold, pointing to its value as a hedge against macroeconomic and geopolitical uncertainties:

• maintains a target price of $2,700/oz by mid-2025

In brief from the UBS report:

• Gold has jumped by 23% in 2024, to its highest ever price, due to lower US yield expectations and diversification out of US dollars by central banks.

• Gold has once again outperformed equities during times of high volatility, reaffirming this historical tendency

• has been supported by the European Central Bank’s rate cuts, although trimmed expectations of the scale of Fed cuts has been been a bit of a counter to this

• support also from flows into physically-backed gold ETFs, August marked the fourth consecutive month of inflows

• safe-haven demand

This article was written by Eamonn Sheridan at www.forexlive.com.