The bank forecasts a near-term pullback in gold prices amid Fed rate hike risks before a longer-term rally to $5,200.
UBS expects gold to climb to $5,200 by June 2027 but warns of a near-term pullback to $3,850 if the Federal Reserve continues raising rates. The bank cites elevated real yields and reduced investment demand as key downside risks, with gold already down nearly 5% since the start of 2026 after peaking above $5,500 in January.
Central bank purchases, running at an annualized pace of 700 tons, remain a critical support, with UBS noting quarterly buying must stay near 300 tons to hold prices above $4,000. However, softer ETF and bar-and-coin demand, alongside rising mine supply, signal cooling investor appetite, leaving Fed policy as the dominant catalyst for gold’s next move.
UBS projects gold at $4,400 by September, $4,600 by December, and $5,000 by March 2027, contingent on the Fed pausing rate hikes and cutting in early 2027.