Swiss bank UBS (NYSE: $UBS) has raised its price target on %Gold as market risks increase.
The lender says it remains bullish on gold despite the precious metal having gained 28% this year, outpacing the rise in stocks, bonds, currencies, and digital assets such as %Bitcoin (CRYPTO: $BTC).
Gold (TVC: $GOLD) is currently at $3,383 U.S. per ounce. UBS sees the price rising to $3,500 U.S. by the end of this year, $3,600 U.S. per ounce by March 2026, and $3,700 U.S. by September 2026.
“We see U.S. macro-related risks, questions over Fed independence, worries about fiscal sustainability, and geopolitics underpinning de-dollarization trends and more central bank buying. In our view, these factors will drive gold prices even higher,” wrote UBS.
The bank expects demand for gold will be supported by a continued move away from the U.S. dollar, concerns about central bank independence in the U.S., and the sustainability of America’s fiscal position with debt levels steadily rising.
In its note to clients, UBS cites recent World Gold Council data showing the strongest inflows into gold exchange-traded funds (ETFs) in the first half of this year since 2010.
The UBS team also lifted their full-year ETF demand forecast to nearly 600 metric tons, from 450 tons previously, as central bank purchases remain strong.
UBS says central bank demand for gold is now at its highest level since 2011.
The main risk to its outlook for gold is if the U.S. Federal Reserve is forced to raise interest rates to counter a rise in inflation.
Gold’s price most recently hit an all-time high of $3,439.20 U.S. on July 22 of this year.
