UBS has reaffirmed its positive stance on gold, rating the metal as “attractive” even as prices sit near all-time highs.
The precious metal has outperformed all other asset classes in 2025, rising 29% since the start of the year, comfortably ahead of equities, bonds and even bitcoin, according to UBS strategists.
In its latest note, UBS set a target of $3,500 per ounce by the end of the year, with a possible upside to $3,800 if geopolitical or economic risks escalate.
The World Gold Council’s recent demand data showed investment demand surging 78% year on year in the first half, led by inflows into exchange-traded funds and strong bar and coin buying, particularly in China.
UBS now expects full-year exchange-traded fund demand just above 600 tonnes, the strongest since 2020.
Total demand is forecast to reach 4,760 tonnes in 2025, the highest since 2011, despite jewellery consumption falling as buyers turn to lighter pieces or alternatives.
Central bank purchases have slowed slightly but remain well above historical averages, with 43% of surveyed reserve managers planning to increase gold holdings in the coming year.
UBS recommends a mid-single-digit allocation to gold for portfolio diversification, adding, “hedges remain a vital component of any well-diversified portfolio”.
In London, gold was steady at $3,424.20.