UBS Sees $5,000 Gold as 2027 Peak

UBS strategists predict that gold prices will peak in the first half of 2027, reaching around $5,000 per ounce. This forecast is based on several factors, including buying power from Chinese institutions and capital flows into gold exchange-traded funds (ETFs). The Swiss bank also notes that recent efforts to stabilize the yen have contributed to reducing the risk of a sell-off in US Treasury bonds.

However, UBS warns that the gold market still faces many risks in the short term. If US economic data continues to be positive, oil prices remain high, causing prolonged inflation concerns, or the market increases expectations that the US Federal Reserve (Fed) will maintain a tough monetary policy, gold may continue to be under pressure.

The bank attributes its long-term optimism about gold to the prospect of real interest rates falling. UBS forecasts that inflation will gradually cool down, allowing the Fed to maintain stable interest rates this year before resuming the easing cycle in 2027. This could reduce the opportunity cost of holding gold and boost investment demand for precious metals.