UBS lowers gold price target for the rest of 2026
Gold closed below its 200-day moving average on June 11 for the first time since October 2023, a level it had held through the entire Iran war.
The metal's muted reaction to one of the most significant geopolitical escalations in years has caught the attention of one of Wall Street's most closely watched precious metals desks.
UBS lowered its gold price forecasts by $300 to $900 per ounce, citing what its strategists called a "double whammy" of stronger U.S. economic data and a Fed easing timeline that has now been pushed to 2027, Investing.com reported. The move follows a similar recalibration in May, when the bank trimmed its year-end target from $5,900 to $5,500.
The bank's strategists, Dominic Schnider, Giovanni Staunovo, and Wayne Gordon, said gold's momentum indicators now point toward the $3,850 to $4,000 per ounce range in the near term.
Why UBS lowered its gold target
The shift traces back to the U.S. jobs report released on June 6. Nonfiscal payrolls added 172,000 jobs in May, more than double the 80,000 economists had expected.
That print erased what remained of the case for a near-term rate cut and pushed December rate hike odds to 70% on the CME FedWatch tool.
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Gold's reaction has been to keep falling, even as that risk stays elevated.
UBS specifically called out gold's "muted response to the escalation between the U.S. and Iran," noting that the lack of a safe-haven bid has encouraged profit-taking and left prices more exposed to the traditional drivers of real yields and the dollar.
Why a $300 to $900 cut does not mean UBS has turned bearish
The size of the cut sounds dramatic until it is placed next to where gold is actually trading. Gold futures were at $4,208.97 on June 12, up 2.31% on the day. UBS's new $3,850 to $4,000 range sits below the current price, meaning the bank is calling for further near-term weakness from here, not describing a price collapse that has already happened.
UBS was explicit that this is a near-term recalibration rather than a change in its underlying view. The bank said it remains "constructive on gold over the next 12 months," with its base case still assuming the Federal Reserve cuts rates by up to 50 basis points in 2027 alongside below-trend U.S. growth.
UBS also said it sees "scope for renewed U.S. dollar weakness," given the size of U.S. fiscal and external deficits, a dynamic that would support gold over time, even if it is not helping right now.
The pillar that has not moved: Central banks are still buying gold
The argument UBS leans on most heavily for its longer-term view is central bank demand, and on that front, the bank's data shows no slowdown. UBS expects annual central bank gold buying to stay within the 750 to 1,000 metric ton range for 2026.
Preliminary May figures show the People's Bank of China added 10 metric tons to its reserves, while Uzbekistan's central bank purchased nearly 9 metric tons in the same month.
China has now added to its gold reserves for 18 consecutive months, according to Goldsilver.com. That kind of buying is structurally different from the investor flows driving gold's day-to-day price action.
Central banks are not adjusting their reserve allocations based on whether the Fed cuts in September or December, which is why UBS continues to treat this demand as a floor under the market, regardless of what happens to its near-term price targets.
What UBS is actually telling investors to do
The most direct part of UBS's note is its conclusion. The bank said weakness toward the $3,850 to $4,000 range "may ultimately prove to be opportunities to build exposure rather than reasons to abandon it." That is a specific instruction: UBS is framing further declines as a buying window, not an exit signal.
UBS also noted that ETF holdings have recorded only modest outflows so far, and that positioning "remains far from extreme and leaves scope for renewed investor participation."
In other words, the bank does not see evidence that investors are capitulating on gold. The selling has been orderly, which UBS reads as room for the trade to reverse once the macro picture shifts.
For investors, the takeaway is less about the specific numbers and more about the sequencing. UBS is telling clients that the next leg of weakness, if it materializes toward $3,850 to $4,000, is the move to use rather than fear, with the bank's own 12-month outlook unchanged on the other side of it.
Whether gold reaches that range before stabilizing now depends largely on how the Fed responds to a labor market that, as of June 6, is no longer giving it cover to ease.
Related: Goldman Sachs has crucial message for gold investors in 2026
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This story was originally published June 12, 2026 at 12:07 PM.