Wed Sep 18 02:45:00 UTC 2024: ## Gold Price to Hit $2,700 by June 2024: UBS Predicts
**New York, NY** – Global investment bank UBS has forecast a continued climb for gold prices, predicting a potential surge to $2,700 per ounce by June 2024. This optimistic outlook is driven by the weakening US dollar amid anticipated interest rate cuts from the Federal Reserve.
UBS analysts point to the declining DXY index, which measures the US dollar against six major currencies, as a key factor. The index has dropped 5% since June, coinciding with gold reaching record highs near $2,600 per ounce. The bank attributes this to lower interest rates reducing the “opportunity cost” of holding non-yielding assets like gold.
Furthermore, UBS predicts that the Federal Reserve will cut interest rates this week, potentially by 50 basis points, citing softening labor market conditions and strong inflation data. The bank foresees a “soft landing” scenario, leading to 100 basis points of rate reductions this year and another 100 next year. This would further bolster gold’s appeal as a safe-haven asset.
UBS also emphasizes the growing US federal deficit as a long-term headwind for the US dollar, further strengthening the case for gold.
Adding to the bullish sentiment, gold exchange-traded funds have seen a rebound in holdings this year, reaching nearly 3,182 metric tons. UBS concludes that gold’s hedging properties make it attractive for portfolios amid macro and geopolitical uncertainties.
The bank’s prediction echoes a similar sentiment from Societe Generale, which recently shifted 100% of its commodity allocation to gold, increasing its holdings to 7% of its total assets. This reflects growing confidence in gold as a safe-haven asset amid global market volatility.
**Disclaimer:** This news article summarizes information from UBS and other sources, but does not constitute financial advice. Investors should conduct their own research before making any investment decisions.
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