$UBS $ANZ $GC
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Banking giants UBS and ANZ have both raised their gold price targets above the critical $3,000 per ounce threshold, reflecting growing confidence that the yellow metal’s rally still has room to run. UBS now expects gold to reach as high as $3,200 per ounce, with ANZ following suit, citing several bullish factors. The upward revisions come as investors closely watch geopolitical risks, potential trade wars, and expectations of further monetary easing by global central banks. Historically seen as a safe-haven asset, gold has continued its upward trajectory as uncertainty in global markets intensifies. The combination of geopolitical turmoil, U.S. tariff policies, and central bank rate cuts has provided strong tailwinds for the metal, making it an increasingly attractive asset for investors seeking protection from volatility.
The anticipation of multiple rate cuts from the U.S. Federal Reserve and other central banks has played a crucial role in gold’s recent surge. Lower interest rates tend to weaken the U.S. dollar and reduce the opportunity cost of holding non-yielding assets like gold. As inflation concerns remain persistent, gold is also being seen as a hedge against eroding purchasing power. UBS analysts pointed out that the Fed’s likely easing cycle, combined with mounting global economic uncertainties, will further drive demand. ANZ echoed similar sentiments, emphasizing that ongoing trade disruptions and rising geopolitical tensions, particularly in regions like the Middle East and Eastern Europe, could increase safe-haven demand. Additionally, central banks around the world have been accumulating gold reserves at an accelerated pace, further contributing to positive sentiment for the metal.
Beyond geopolitical concerns and monetary policy, the rising implementation of protectionist trade policies is another key driver of higher gold prices. The re-emergence of tariffs, particularly in U.S.-China relations and Europe’s shifting trade dynamics, has raised fears of a slowdown in global trade activity. Historically, periods of increased trade restrictions have coincided with gold price appreciation, as investors shift towards assets with intrinsic value. Market analysts also point to the potential for inflation to remain sticky even as central banks cut rates, creating a macroeconomic environment that continues to favor gold. With rising costs in energy and commodities yet to see significant declines, many institutions view an extended bull run for gold as likely. This scenario could further lead to record-high prices in the coming quarters.
While the upward momentum in gold prices is being fueled by several factors, investors still need to monitor potential risks. A stronger-than-expected U.S. economic recovery, unexpected changes in Federal Reserve policy, or a de-escalation in geopolitical tensions could limit further gains in the metal. However, UBS and ANZ remain optimistic that gold’s fundamental drivers remain intact for now. Should rate cuts materialize as expected and geopolitical risks persist, the push toward new all-time highs above $3,000 per ounce seems increasingly probable. With gold ETFs seeing renewed inflows and physical demand from central banks remaining robust, the ongoing rally remains well-supported. For long-term investors, gold continues to be a compelling hedge against financial uncertainty amid a global economy facing complex challenges.
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