International gold prices fall below $4,450, and Huaxia Gold ETF (518850) accelerates its decline in the afternoon. UBS is bullish: expects gold prices to reach $5,900 by early 2027.

On March 26, oil prices rebounded while international gold prices came under pressure, with COMEX gold futures prices falling below $4,450 per ounce, and London gold losing $4,430 per ounce. In the secondary market, gold ETFs accelerated their decline; as of 14:15, the Hua Xia Gold ETF (518850) dropped 2.68%, Hua Xia Gold stocks (159562) fell 3.53%, and the Hua Xia Nonferrous Metals ETF (516650) decreased by 1.99%.

According to China News Service, UBS CIO stated that for many investors, intuitively, gold serves as a “safe haven” during geopolitical tensions, but the current price performance and volatile market conditions suggest otherwise. Historically, gold does not always rise during geopolitical conflicts, especially in the initial stages. For example, during the oil shocks of the 1970s, gold rose due to inflation concerns, but during events like the Iraq War, various macro factors led to mediocre gold performance. Each geopolitical event has its unique macroeconomic background, with differing conditions for inflation, policy expectations, and capital flows.

UBS CIO believes that gold is currently facing multiple resistances, including energy-driven inflation and interest rate hike expectations, a strengthening dollar, and outflows of investment funds, but these should be considered short-term factors. The current situation may trigger a slowdown in global economic growth, which could alleviate some factors unfavorable to gold prices. This downturn may be a correction in the long-term upward trajectory of gold. Although gold prices may still decline, based on the institution’s expectation that prices will eventually rebound, these levels are attractive for long-term investors. UBS CIO expects the target price for gold in early 2027 to be $5,900 per ounce.