The value of protected haven gold, which has soared practically 30 % this 12 months, might rise additional and stay excessive as international uncertainties persist, based on Swiss funding financial institution UBS.
“We’re very bullish on gold. We expect that the costs will go greater and what’s attention-grabbing is we expect it is going to keep greater for longer than anticipated,” Yeoh Choo Guan, the financial institution’s head of ASEAN international markets, informed CNBC on Friday.
She stated the financial institution has raised its forecast for gold subsequent 12 months from $ 1,850 to $ 2,100 per ounce. On Friday, the yellow metallic was buying and selling at round $ 1,953, which is roughly 29 % greater than the place it was initially of the 12 months.
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In line with Yeoh, the setting of adverse actual rates of interest and international uncertainties, together with the upcoming US presidential election, are among the many components pushing traders to construct up their gold holdings.
“So just lately we’ve got a retracement within the fairness market. What was attention-grabbing is that gold was very resilient regardless of the fairness’s pullback, suggesting that there’s ongoing shopping for help,” she stated.
READ MORE: Gold might be heading to $ 5,000 per ounce
“On prime of that, gold can also be a really enticing portfolio diversifier. I feel a number of traders have been piling into bonds and REITs [real estate investment trusts], so gold is considered as a substitute for that, in case that specific section provides you stress.”
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