UBS Strategists: Federal Reserve's "Hawkish Rate Hike" Does Not Alter Gold's Long-Term Bullish Logic, Phased Target Sees Highest at $5,400
UBS strategist Giovanni Staunovo believes that despite the Federal Reserve's decision on September 16 to raise the federal funds rate target range by 25 basis points to 3.75%-4.00% and signal a potential further rate hike this year, which will suppress gold prices in the short term, factors such as rising global debt levels, an anticipated medium-term weakening of the US dollar, and the prospect of Fed rate cuts next year will support gold demand. He views a gold price pullback to around $4,000 per ounce as an opportune moment to increase holdings, setting phased targets: $4,600 by December 2026, $5,000 by March 2027, $5,200 by June 2027, and $5,400 by September 2027. Additionally, the People's Bank of China (PBOC) increased its gold holdings by approximately 20 metric tons in August, with continuous central bank gold purchases providing structural support.
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