Gold: Next stop $3,200? This investment bank thinks it's a possibility
Published: 11:30 19 Mar 2025 EDT
Gold prices have surged to new record highs, and according to UBS, this wasn’t a surprise - it was more a matter of when rather than if it would happen.
With global uncertainty growing, trade tensions rising, and the US dollar weakening, gold has had plenty of reasons to climb.
One key factor in this rally has been strong demand from investors buying into gold ETFs (exchange-traded funds).
Even though more money is flowing into these funds, total holdings are still well below the peak reached five years ago, meaning there’s room for more buying.
Notably, Chinese gold ETFs have seen a sharp increase, suggesting growing interest despite weaker jewellery sales.
UBS remains optimistic about gold’s prospects and sees further upside potential.
It believes thin market liquidity could amplify price moves and that more investors will see gold as a crucial hedge against economic or geopolitical turmoil.
The longer the yellow metal stays above $3,000, the more investors may jump in, fearing they’ll miss out. This could also boost interest in silver and platinum as traders look for alternative ways to ride the gold rally.
"We remain bullish gold and see upside risks to our forecasts," UBS said. In plain language, that suggests the Swiss bank believes the price will go above its current target price of $3,200 an ounce.
