UBS: The current decrease in gold price is just a correction within its long-term upward trajectory.

UBS Wealth Management's Investment Director's Office pointed out that historical trends indicate that when monetary policy shifts towards tightening and real yields rise, the price of gold will initially decline and then further retreat. Whether the current selling pressure will continue largely depends on whether the Fed's policy stance changes. After years of strong returns and capital needs, profit-taking by investors has also intensified selling pressure on gold. In addition, the Middle East is an important hub for global gold trade and consumption, and conflicts in the region have caused supply and demand disruptions, further weighing on gold prices. Gold is currently facing multiple obstacles, including energy-driven inflation and rate hike expectations, a strong US dollar, and outflows of investment funds. However, UBS believes these are short-term factors. The current situation may lead to a global economic slowdown, causing some factors unfavorable to gold prices to fade. Rather than seeing this decline as gold losing value, it is better to view it as a retracement in gold's long-term upward trajectory. For investment portfolios, gold continues to play an important role in hedging and diversification. Although the price of gold may still fall, based on UBS's expectation that prices will eventually rebound, these levels are attractive to long-term investors. The target price for gold in early 2027 is expected to be $5900 per ounce.