In a bold move reflecting growing economic uncertainties, UBS Group has revised its gold price forecast upward to $3,200 per ounce for the next four quarters. This significant adjustment from their previous long-held target of $3,000 underscores the Swiss banking giant’s confidence in gold’s enduring appeal as a safe-haven asset.
The revision comes on the heels of gold’s recent rally, which saw the precious metal surpass the $3,000 mark earlier than many analysts had anticipated. UBS analysts, including Wayne Gordon and Giovanni Staunovo, point to several factors driving this bullish outlook.
Central to their forecast is the escalating global trade conflict, particularly the looming threat of broad reciprocal tariffs and additional sector-specific tariffs planned by U.S. President Donald Trump for next month. These trade tensions are expected to fuel demand for safe-haven assets, with gold being a prime beneficiary.
Moreover, UBS highlights stronger inflows into gold-backed exchange-traded funds (ETFs) as another key driver of gold prices. This trend, coupled with robust central bank buying, is anticipated to provide substantial support to the gold market. The bank expects central bank gold purchases to remain strong, potentially exceeding 1,000 tonnes by year-end.
The economic outlook for the United States is also playing a role in UBS’s revised forecast. As concerns about a potential recession grow, traders are pricing in additional interest rate cuts by the Federal Reserve. Lower interest rates typically boost the appeal of non-yield-bearing assets like gold.
UBS is not alone in its optimistic view of gold. Other financial institutions have also raised their price targets recently. Macquarie Group, for instance, projects gold prices could spike to $3,500 an ounce in the second quarter, while Goldman Sachs has lifted its 2025 forecast to $3,100 an ounce.
The gold market has already demonstrated remarkable strength in 2025, with prices up nearly 15% year-to-date. This performance positions gold among the top-performing assets in commodity markets, outpacing many traditional investment vehicles.
Despite reaching new all-time highs, some analysts believe the rally still has room to run. UBS commodity strategists suggest that the prevailing mood among investors remains cautious towards U.S. equities but confident in gold. This sentiment could further propel gold prices in the coming months.
It’s worth noting that UBS’s previous gold price predictions have proven accurate. The bank was among the first to forecast gold reaching $3,000 in the first half of 2025, a milestone that has already been achieved.
For investors considering entry into the gold market, UBS analysts view any pullbacks as potential opportunities to build fresh long positions. They reiterate their preference for the metal, emphasizing its role as a portfolio diversifier and hedge against economic uncertainties.
As global trade conflicts persist and central banks continue their gold-buying spree, the outlook for the precious metal remains bright. While past performance doesn’t guarantee future results, UBS’s revised forecast suggests that gold’s glitter may not fade anytime soon.
