The ongoing uncertainty on the economic and geopolitical levels has accelerated the gold prices to hit a record high of $3,000 per ounce last week, and UBS believes it could go further.
The gold price briefly soared past the 3,000 level for the first time during the trading session on March 14 with observers estimated the main factors came from the trade war caused by the US President Donald Trump and the need for stability by the investor due to the weak US sentiment.
UBS Global Wealth Management’s chief investment office also speculated that the gold price will keep rising as long as the policy risks and an intensifying trade conflict continues.
UBS also estimated that the gold price could rise to $3200 per ounce, citing mainly from the ETF inflows, as well as the central bank buying. There is a speculation that the buying this year could reach 1,000 metric tons, relatively similar to last year.
UBS stated that the investor may have overbought the gold but believed that investors would remain cautious on US equity while confident in gold. In addition, the bank also stated that if Trump tones down his trade policies, that would impact investors taking on a defensive buying on gold. The Swiss investment bank set a downside technical support level at $2,850 per ounce.
