Gold may consolidate near-term but head to new peaks next year, says UBS

Gold may be headed for another strong year, with UBS maintaining a bullish stance on precious metals despite recent volatility.Joni Teves, Precious Metals Strategist at UBS, told CNBC-TV18 that the broader backdrop of macro uncertainty, geopolitical risks and expectations of further US Federal Reserve easing continues to favour safe-haven assets.

Teves acknowledged the sharp swings in gold over the past week but said the structural outlook remains intact. “We remain bullish on gold overall. We think that the market can continue to see new highs over the coming year,” she said.

UBS has set a $4,500 target for gold in 2026, while its 2025 target stands at $4,200, indicating a period of consolidation within the recent trading range. The brokerage also sees $5,000 as an upside scenario, but only if stronger-than-expected catalysts emerge.UBS notes that weaker US economic data, a more dovish shift from the Federal Reserve, or heightened concerns around the Fed’s independence could all trigger a sharper rally in gold than currently anticipated.

According to her, portfolio diversification remains a major driver. Investors are increasing their allocations to gold as real rates are likely to fall further and central banks continue to add to their reserves. Physical investment demand has also stayed resilient despite pressure on jewellery demand.While the long-term outlook is positive, Teves expects the market to stabilise between now and December. “We do expect a bit of consolidation to continue… investors are increasingly less inclined to put on large positions into year-end,” she said, adding that buying interest on dips should keep downside risks contained.

On silver, Teves expects the metal to continue benefiting from gold’s strength and tight market conditions. “Our expectation in silver is that it outperforms gold on bursts,” she said, describing it as a higher-beta way to express bullishness on precious metals.

However, she flagged the risk that weaker global growth could drag on silver’s industrial demand—an important component of its pricing. Unlike gold, silver also lacks official-sector support, as central banks do not hold it in reserves.

UBS’ first target is $55, with upside between $60–65 in a bullish scenario where gold rallies sharply and lifts the entire precious-metals complex.

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