UBS Sticks to $5,000 Gold Call Despite Near-Term Risks

UBS analysts remain bullish on gold prices, maintaining their target of $5,000 per ounce in the first half of 2027. This prediction implies an 18% upside from the recent break above $4,250 an ounce.

The bank attributes the latest rally to Chinese institutional buying and continued exchange traded fund inflows, as well as reduced Treasury sell-off risk after joint US and Japanese efforts to stabilize the yen.

UBS points to three key drivers supporting gold's medium- to long-term prospects: falling real yields, dollar weakness tied to US fiscal deficits, and durable central bank demand.

However, the analysts caution that near-term risks persist, including firm US economic data, rising oil prices reviving inflation concerns, or markets pricing in a more hawkish Fed rate path. These factors could delay the rally and push prices back toward $4,000 an ounce.