UBS’s Outstanding Gold and Silver Forecast

While gold prices were supported by stronger pricing in from the Federal Reserve to start cutting interest rates this year, Swiss banking giant UBS made a striking prediction.

Stronger pricing that the Federal Reserve will start cutting interest rates this year supported gold prices.

Although the ADP private sector employment data released yesterday by the United States was still lower than market expectations, with an increase of 152,000 in May, annual wages in May increased by 5%, the same as in April. As the US labor market data tends to cool, it is a foregone conclusion that the Federal Reserve will start to cut interest rates this year.

In the money market, there is a 79% chance that the Fed will cut interest rates for the first time in September and 82% in November, while there is an 86% chance that the bank will cut interest rates for the second time after a possible rate cut in December.

Gold market updates

Affected by this, the price of gold rose 1.2% yesterday to close at $200,355, and traded at $200,359 today, up 0.2% from the midday closing price.

Yesterday, despite the decline in the US dollar, the price of gold in grams rose in tandem with the price of ounces and closed at 2000 443 TL, an increase of 0.2%.

Gold prices, after rising at the start of the new day, were trading at 2,000 445 TL, up 0.4% from the previous day’s close (as of 13.00). Meanwhile, Quarter Gold was sold for 4,000 14 TL, and Republic Gold for 16,005 TL.

An ounce of silver was trading at $30.3, up 1%, while a gram of silver was trading at 31.40 TL.

Swiss National Bank’s Surprising Gold and Silver Forecast

Swiss banking giant UBS raised its forecasts for the metals market, citing strong structural support and solid demand.

UBS strategists who increased their gold bets also raised their price forecasts, expecting silver to outperform gold in the near term.

UBS said concerns about the upcoming US election and the US fiscal deficit could serve as a further catalyst for higher gold prices in the second half of 2024.

Although the investment bank expects gold prices to average $200,365 in 2024, up 8% from its previous forecast, it sets its year-end target at $200,600. UBS predicts that gold prices will exceed $2,800 in the next two years.

The analysts raised their average silver price forecast for 2024 by 14% and their year-end forecast by 20%. The Swiss investment bank raised its average silver price forecast for 2024 to $30.5 and its year-end price target to $36.

“Our new silver price forecast reflects better performance than gold,” the strategists said. “We believe silver will perform relatively well in an environment of rising gold prices, expected easing by the Federal Reserve, and tighter market supply and demand fundamentals,” he said.