OraFinanza – Oro a little less brilliant in recent weeks, with today’s price at 2,658 dollars (gold futures) and 2,642 dollars (spot) per ounce, a around 150 dollars (-4.7%) below its record at the end of Octoberwhen it broke through to $2,750 (futures). The balance sheet for 2024 remains largely positive, with +28% rising to +35% (in euros) due to the revaluation of the dollar.
Right at strong acceleration of the dollar The pause in raw material prices appears to be due in recent weeks, supported by the prospects of high rates for a longer period than the markets had previously expected. Today the Federal Reservealbeit making a cut (25 basis points), should launch cautionary signs for upcoming meetingsmotivating them with the resistance of inflation and the solidity of the labor market.
Despite the tarnishing of gold, analysts of Ubs maintain a bullish view on the commodity for the next 12 months, predicting the reaching 2,900 dollars an ounce by the end of next year. The bank recommends an allocation of around 5% within a balanced US dollar-based portfolio as a diversifier.
Beyond gold, UBS sees long-term opportunities also in and in other transition metalsin view of the increase in demand linked to growing investments in energy generation, storage and electric transport.
Among the elements underlying UBS’s optimism are several factors. The first is represented byaccumulation by central banks: The broker predicts that central banks will continue to accumulate gold to diversify reserves.
“The latest data from the International Monetary Fund showed that net purchases of gold by global central banks in October rose to the highest monthly level this year,” they explain from UBS which now expects the official sector to buy 982 metric tons of gold this year, with an expectation of at least 900 tons for 2025.
The second factor is represented by demand as a portfolio hedge. “With uncertainties related to President-elect Donald Trump’s policies and ongoing geopolitical tensions, demand for gold as a key portfolio hedge is expected to increase,” experts predict.
Furthermore, the prices should also be supported by the lower interest rates: UBS expects the Fed to cut rates by 25 basis points today, with further easing expected next year, which should reduce the opportunity cost of holding the non-interest-bearing metal.
Finally, theweakening of the US dollar: “A weaker greenback in the medium term, due to lower rates and concerns about the trajectory of US government debt, should also support gold prices,” they conclude from UBS.
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