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UBS Wealth recommends buying gold near US$1,200 for insurance

Bloomberg Published on Wed, Jul 05, 2017 / 4:26 PM GMT+8

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SINGAPORE (July 5): Gold will probably trade in a range of US$1,200 ($1,657) to US$1,300 ($1,795) an ounce in the short-term as the metal tracks US real interest rates, according to UBS Group AG's wealth management unit.

"We're not saying we have a bullish bias; we're not saying we have a bearish bias," Wayne Gordon, executive director for commodities and foreign exchange, said in an interview on Tuesday. "We're saying that tactically, people should be buying it somewhere near US$1,200 and selling it again somewhere near US$1,300, and it's because we have a view that real rates go sideways. So the pickup in nominal rates will be equally matched by the pickup in inflation."

Bullion climbed almost 9% in the first quarter, buoyed by worries over Donald Trump's presidency and geopolitical risks. Prices have since fallen and posted their first monthly decline this year in June.