October 21, 2025 | Singapore – Global wealth management strategist Sagar Khandelwal of UBS has projected that gold prices could soar to US$4,700 per ounce in the first quarter of 2026, driven by rising geopolitical tensions, global debt concerns, and monetary policy shifts.
According to Khandelwal, the recent surge in gold prices—already up more than 60% year-to-date—has outperformed all major asset classes. “The U.S. government shutdown and intensifying trade frictions have injected new energy into the gold market,” he said. “Although the rapid price rally may cause short-term volatility, gold remains a critical component of a balanced investment strategy.”
He noted that the combination of lower real interest rates, a weaker U.S. dollar, rising fiscal deficits, and ongoing geopolitical instability continues to strengthen the case for gold. Khandelwal also cautioned that as the U.S. Federal Reserve continues to cut rates despite persistent inflation, real interest rates could slip into negative territory—reducing the dollar’s appeal and drawing more investors to gold.
Data from the World Gold Council supports this bullish sentiment. In September, global gold exchange-traded funds (ETFs) recorded a historic US$17 billion net inflow, contributing to a total of US$26 billion over the past three months—the strongest quarterly inflow ever recorded.
UBS expects the global demand for gold to reach approximately 4,850 metric tons in 2025, the highest level since 2011. This growth is fueled by consistent central bank purchases and a gradual shift among private investors from U.S. Treasuries to gold holdings.
“As long as economic, political, and policy uncertainties persist, we anticipate continued capital inflows into gold, which could push prices toward our upper target of US$4,700 per ounce,” Khandelwal added.
He further suggested that investors maintain around 5% gold exposure in diversified portfolios due to gold’s low correlation with equities and bonds, particularly during market stress. Additionally, he highlighted that gold mining stocks could outperform the precious metal itself in the coming months as companies benefit from higher prices and expanding profit margins.
On Monday, spot gold climbed 2.3% to US$4,346.39 per ounce, while U.S. gold futures for December delivery rose 3.5% to US$4,359.40 per ounce, marking a new all-time closing high.