The gold rally has further to go, that's according to analysts at Swiss bank UBS.
Citing strong investment inflows, a weaker US dollar, and increased geopolitical risk, the bank has now raised its gold price forecast to US$4,200 per ounce.
It comes after the gold price in recent sessions touched US$3,896.
That takes 2025's gains to 47%, which marks the strongest annual performance since 1979.
UBS highlighted that gold remains its top-performing asset and said the yellow metal continues to benefit from lower US real interest rates and expectations of a renewed rate cut cycle.
ETF demand, meanwhile, has outpaced earlier estimates, highlighted UBS, which pointed to a new forecast that sees the total at 830 metric tons for 2025.
Central bank purchases remain strong; meanwhile, with the bank highlighting a total of 900–950 metric tons.
“We stay long gold in our global asset allocation and maintain our Attractive rating,” the Swiss bank said.
The bank’s upside scenario has been lifted to US$4,700/oz.
UBS said it recommends a mid-single-digit portfolio allocation to gold, citing diversification benefits and favourable momentum.
Risks to the bank's forecast are said to be any stronger-than-anticipated US growth, or alternatively a reversal in the Federal Reserve's interest rate policy.