UBS hikes 1-month Gold price forecast from $1,180 to $1,280/Oz

UNITED STATES February 21 2014 4:11 PM

NEW YORK (Scrap Register): Zurich based UBS hiked its one-month gold price forecast from $1,180 an ounce to $1,280 an ounce, saying how this change “only highlights how fast prices and sentiment have moved; we're not inclined to chase the market higher here, said Edel Tully, market strategist at UBS.

UBS raised its guidance for gold and silver prices, lifting its short-term and 2014 average price forecasts for both metals, noting a shift in attitudes toward gold.

“Gold has started to shed its stigma, if slowly. The attitudes toward gold have improved, but given that gold prices are up 9% in 2014, UBS is “nervous” that tactical traders may take profits,” said Edel Tully, via Kitco News.

“We do like gold a good deal more than we did at the end of 2013, but many obstacles still abound. We'd view a journey down to $1,280 as a buying opportunity,” she added.

UBS increased its three-month forecast for gold to $1,350, up from $1100 previously. If India removes its 80/20 tariff on gold, prices could move closer to $1,400, Tully added.

“Although we feel gold isn’t deserving of a price tag north of $1,400, a price sub-$1,200 seems similarly underserved. Effectively we see gold higher, but within a range,” she said.