UBS raises gold target price for end-March 2026 by $100 to $3,600/oz

Aug 18 (Reuters) - UBS on Monday raised its gold target price for end-March 2026 by $100 to $3,600 per ounce as persistent U.S. macroeconomic risks, de-dollarization trends, and strong investment demand — especially from exchange-traded funds (ETFs) and central banks — are expected to drive gold prices higher.

UBS also lifted its end-June 2026 forecast by $200 to $3,700 per ounce and introduced a new end-September 2026 target at the same level.

The bank expects sticky U.S. inflation, below-trend growth that is likely to prompt U.S. Federal Reserve policy easing, and continued dollar weakness will collectively support higher gold prices.

"We see U.S. macro-related risks, questions over Fed independence, worries about fiscal sustainability, and geopolitics underpinning de-dollarization trends and more central bank buying. In our view, these factors will drive gold prices even higher," UBS said in a note.

UBS raised its full-year ETF gold demand forecast to nearly 600 metric tons from 450 metric tons, citing World Gold Council data showing the strongest first-half 2025 inflows since 2010.

"Central bank purchases should stay strong, albeit slightly below last year's near-record purchases. We, therefore, now forecast global gold demand to increase by 3% to 4,760 mt in 2025, which would mark the highest level since 2011," UBS added.

U.S. gold futures GCcv1 for December delivery settled 0.1% lower at $3,378 on Monday, pressured by a stronger dollar, while investors focused on U.S. President Donald Trump's meeting with Ukrainian and European leaders.