UBS raised its gold targets and flagged a $7,200 upside case, citing powerful demand tailwinds and elevated geopolitical and policy uncertainty.
Summary:
-
UBS lifted its gold price targets sharply, citing heavy investment flows, central bank demand and elevated geopolitical risk.
-
The bank now targets $6,200/oz for March, June and September 2026, up from $5,000 previously.
-
An upside scenario sees gold reaching $7,200/oz, while a downside case is placed at $4,600.
-
Central bank buying is still seen at around 950 tonnes in 2026, with Poland’s reserve target hike flagged as structurally supportive.
-
UBS expects prices to ease modestly to $5,900 by end-2026, partly reflecting post-US midterm election dynamics.
UBS has reinforced its bullish stance on gold, lifting its price targets and arguing that a rare alignment of structural and cyclical forces is driving the metal’s strongest performance in decades. The bank noted that gold prices are on track for their best monthly showing since the 1980s, supported by heavy investment inflows, sustained central bank buying and elevated geopolitical and policy uncertainty.
UBS raised its XAU/USD forecasts to $6,200 per ounce for March, June and September 2026, up from a previous target of $5,000. The upgrade reflects UBS’s view that demand dynamics remain unusually resilient, even at record price levels. The bank also outlined a bullish upside scenario in which gold could climb to $7,200 per ounce, particularly if geopolitical tensions escalate sharply or uncertainty around global economic policy intensifies further.
On the demand side, UBS lifted its 2026 forecasts across most segments, highlighting continued strength in investment and physical demand. Central bank buying is still expected to total around 950 metric tonnes next year, a level UBS sees as structurally supportive. It pointed to Poland’s decision to raise its gold reserve target to 700 tonnes from 550 tonnes as a notable signal, suggesting that if similar behaviour is adopted more broadly, price sensitivity among official buyers could diminish.
In China, UBS said physical demand has remained resilient despite record prices, aided by seasonal factors and constructive sentiment. However, it expects some moderation after the Lunar New Year as seasonal support fades.
Despite its constructive outlook, UBS does not see gold rising indefinitely. The bank expects prices to ease modestly after the US midterm elections, forecasting gold at around $5,900 per ounce by the end of 2026. Downside risks include a more hawkish Federal Reserve pushing US real rates higher, which could weigh on prices. Even so, UBS reiterated that gold remains an attractive hedge against economic uncertainty, fiscal stress and policy risk.
This article was written by Eamonn Sheridan at investinglive.com.