UBS: Gold Looks Poised to Surge Past $1,800 An Ounce

SEATTLE (Scrap Monster):  UBS Investment Bank, in its latest research report, states that gold has growing potential to break the highs recorded earlier during the year. The uncertainties on account of Covid-19 pandemic are likely to lift gold prices to $1,800 per ounce.

According to Joni Teves, precious metal strategist at UBS Investment Bank, gold prices have declined during the month of March this year, in line with other assets. However, the prices are likely to stage strong rebound in the near-term, with a price target of $1,790 per Oz. The elevated price for the yellow metal is mainly on account of rise in investor interest in the midst of market uncertainties and negative real rates. Incidentally, gold prices have surged higher by almost 12% since the beginning of the year.

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The strong move in gold was mainly triggered by surge in investor interest, primarily from institutional investors. The potential negative impacts to global economy caused by the virus have had great influence on safe haven gold demand. The most recent report published by the World Gold Council (WGC) notes that gold-backed exchange-traded funds (ETFs) recorded highest quarterly inflows in four years in Q1 2020.

It must be noted that the Bank of America had raised the 18-month price target of gold to $3,000 per Oz.