As trade conflicts escalate and central banks continue to stockpile, top financial establishments are adjusting their predictions for gold prices upwards. Both Citi and UBS have recently revised their forecasts, suggesting that the upward trend in gold prices will persist amidst geopolitical stress and economic unpredictability.

The surge in gold prices has also positively impacted gold-backed digital currencies. Cryptocurrencies like PAXG and XAUT, which are secured by physical gold held in vaults, have seen their performance mirror that of the precious metal. Amid the current uncertainty, these tokens have outperformed the broader cryptocurrency market.

Citi has modified its short-term gold price prediction to $3,000 per ounce and has raised its annual average forecast to $2,900, up from the previous estimate of $2,800, as reported by Investing.com. The reasons for the upward revision include not just the aforementioned factors, but also concerns about global economic growth which are expected to increase demand for gold.

On the other hand, UBS has upgraded its gold price target for the next 12 months to $3,000 per ounce, a significant increase from the previous prediction of $2,850. The current trading price of the precious metal has already surpassed the latter, reaching $2,860 following a year-to-date increase of approximately 9%.

In a recent note, UBS strategists, led by Mark Haefele, stated that the consistent attractiveness of gold as a safe haven and a hedge against uncertainty has once again been validated. Citi, in its note, highlighted the role of trade conflicts and geopolitical strain in reinforcing the trend of reserve diversification and de-dollarization, thereby supporting the demand for gold in emerging markets.
For more information, see: Surge in Gold-Backed Cryptocurrencies as Precious Metal Hits Record Amid Trade War Concerns.