SINGAPORE — Gold prices — which surged nearly 30% this year — could rise further and remain high as global uncertainties persist, according to Swiss banking giant UBS.
“We are very bullish on gold. We think that the prices will go higher and what is interesting is we think it will stay higher for longer than expected,” Yeoh Choo Guan, the bank’s head of Asean global markets, told CNBC’s “Squawk Box Asia” on Friday.
She said the bank has raised its forecast for gold next year from $1,850 to $2,100 per ounce. Spot gold was trading at around $1,953 on Friday — roughly 29% higher than where it was at the start of the year.
An environment of negative real interest rates and global uncertainties, such as the upcoming U.S. presidential election, are among the reasons that have pushed investors to build up their gold holdings, said Yeoh.
Gold bars being manufactured at the Prioksky plant of non-ferrous metals in the town of Kasimov.
Alexander Ryumin | TASS via Getty Images
“So recently we have a retracement in the equity market. What was interesting is that gold was very resilient despite the equity’s pullback, suggesting that there’s ongoing buying support,” she said.
“On top of that, gold is also a very attractive portfolio diversifier. I think a lot of investors have been piling into bonds and REITs (real estate investment trusts), so gold is viewed as an alternative to that, in case that particular